Development Economics

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Browsing Development Economics by Author "Fanta, Gossaye"

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    Households’ Willingness to Pay for Improved Water Services in Debre-Zeit Town, Ethiopia
    (Addis Ababa University, 2007-08) Fanta, Gossaye; GebreEgzibeher, Tegegne (PhD)
    Water is vital for life. However, many people especially in developing countries have no access to adequate potable water services. In Ethiopia in both urban and rural areas many people do not get safe clean water. The need for clean potable water is high. Debre Zeit town has high water shortage problem. In this study the contingent valuation survey method is employed to analyze households' willingness to pay for the improved water services. In this study survey responses of 234 randomly selected sampled households from all kebeles Debre Zeit town were analyzed through descriptive and econometric analysis. The survey result shows that 99.57% of the survey respondents use pipe water. However, only 10.26% of the respondent satisfied with the status quo level. All survey respondents expressed their willingness to pay above the existing tariff level, though the amount of money they are willing to pay varies from individual to individual. That is, if the improved system is implemented the authorities can collect more money from water sale and at the same time the water need of the households would be satisfied. The survey result also shows that mean willingness to pay for one bucket or for 20 liter of improved water service is 10.2367 and 12.4786 cents according to the dichotomous choice and open-ended survey responses respectively. The total willingness to pay for one bucket or 20 liters of improved water services is 262,781.45 cents or Birr 2,627.82 per day or Birr 959,159.30 per year. Thej Results of both Probit and OLS econometric models show that age, household size, reliability dummy and the income variables influences households’ willingness to pay for the improved water services in the Debre Zeit town. Therefore in designing the improved water supply system for the town policy makers need to take these socio- economic and demographic factors and water attributes into consideration.