New Directions in Productivity Measurement and Efficiency Analysis
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New Directions in Productivity Measurement and Efficiency Analysis

Counting the Environment and Natural Resources

Edited by Tihomir Ancev, M. A.S. Azad and Francesc Hernández-Sancho

This book explores novel research perspectives on the intersection of environmental/natural resource economics and productivity analysis, emphasizing the link between productivity and efficiency measurement and environmental impacts. The purpose of the book is to present new approaches and methods for measuring environmentally adjusted productivity and efficiency, and for incorporating natural resources in standard national accounting practices. These methods are applicable in many contexts, including air and water pollution, climate change, green accounting, and environmental regulation
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Chapter 9: Environmentally adjusted efficiency of municipal water suppliers

Francesc Hernández-Sancho and Águeda Bellver-Domingo


This chapter provides a comprehensive literature review of efficiency studies in the water sector, and then focuses on the literature on environmentally adjusted efficiency methodologies. In this direction, a specific interest is in the extent of water leaks in the supply network. This chapter takes into account different points of view. One of them is the economic point of view, which considers that water leaks are non-revenue water with a negative impact on sector efficiency. From an environmental point of view, leakages cause inefficient energy use in the water supply network, and may also affect water quality by increasing susceptibility to contamination under low-pressure conditions. The chapter evaluates the efficiency of municipal water suppliers in terms of water leakages, with the aim of demonstrating how inefficiency in the supply process can negatively affect urban water users. It also presents different methodologies that allow us estimate the efficiency level of municipal water suppliers.

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