Vitamin H

What Is the Equity-Efficiency Tradeoff when Maintaining Wells in Rural Haiti?

“…The size of the HO user fee also suggests that income is unlikely to be the key driver of the price elasticity of demand. At 20 gourdes per month, the median HO user fee is 0.5 percent of the average monthly income of rural families in Haiti (Lunde (2010), p 50) and 1.2, 0.6, and 0.3 percent of monthly income for, respectively, the 25th, 50th, and 75th percentiles of rural households in Haiti (Lunde (2009)). 14 Such costs would qualify as "affordable" or nearly so under the most common definitions used in the US: The US Environmental Protection Agency has defined affordable expenditures on water and wastewater as those under 2.0 (1993) and 2.5 (1998) percent of median household income, with a burden of 2.0 percent of income being the generally accepted threshold of determining affordability for low-income households (Fisher et al (2005)).…”

“…WIN (2000) estimated that 18 percent of US households, many of them poor, paid more than 4 percent of their income on their water and sewer bill in 1997, with 13 A 50 percent annual breakdown rate is also near the rate hypothesized by members of the HO staff. 14 Assuming the median rural household has 5 members (Lunde (2009), Table 1.11), then the 25th, 50th, and 75th percentiles of monthly household income are, respectively, 1,665, 3,335, and 6,250 gourdes (Lunde (2009) , Table 7.11). These costs are also comparable to estimates of the costs for providing chlorine (Lantagne et al (2007)).…”

“…SeeLunde (2010) for a discussion of the PPP calculation for Haiti from the World Economic Outlook (WEO).20 Recall the functional form in Equation 6 was specified so that δ(θ, q = 0) = 1, δ(θ, q) < 1 for all q > 0, and δ(θ, q) > δ(θ, q ′ ) for q < q ′ .…”