Pedro Simões

Influence of regulation on the productivity of waste utilities. What can we learn with the Portuguese experience

This paper examines the merits and the perverse effects of quality of service regulation in the performance of urban waste services when implemented alone and compares the performance of different economic regulatory methods. By means of a productivity analysis, we investigate the influence of a five-year period of regulation on the performance of Portuguese urban waste utilities using an unbalanced panel data for the period 2001-2008. Different non-parametric methods were applied to estimate the productivity change, all leading to similar outcomes. We observed a tendency of productivity decline in the urban waste utilities and concluded that in spite of the unequivocal improvements in the quality of service induced by sunshine regulation, more should be done as far as economic regulation is concerned. We also found that the use of sunshine regulation together with low incentive economic regulatory methods is not positive, leading to overinvestment rather than to value for money.

Performance and congestion analysis of the portuguese hospital services

The health care services have been characterized by a growing demand by the citizens leading to the need of more and more resources. Population aging, new pathologies, drugs, as well as new treatments are some of the major factors for this. However, in hospitals, for example, consumption of a large number of inputs has not frequently corresponded to the production of the same or more proportion of outputs. Sometimes, the outputs even decline with the increase of inputs due to the influence of the congestion effect on efficiency. The heavy burden of the health sector on the state budget brings about the interest of research over its efficiency. This paper aims to assess the performance of the Portuguese hospitals and particularly the contribution of the congestion effect. We use the non-parametric technique of data envelopment analysis for this purpose and a double-bootstrap procedure to take into account the influence of operational environment on efficiency. Afterwards, by comparing three different approaches, we determine the importance of congestion in efficiency measurement and discuss its computation methodologically. The results suggest significant levels of inefficiency in 68 major Portuguese hospitals for the year 2005 and more than half of them were found to be congested.

Seaport performance analysis using robust non-parametric efficiency estimators

Abstract Seaport services have been developing year on year, playing an increasingly important role in the economy and the transportation markets of each country. This increases interest in measuring their performance. This paper evaluates the performance of a set of European seaports by means of robust non-parametric approaches. Using order-m and bootstrap procedures, the major problems of traditional data envelopment analysis and free disposal hull methods – concerning noise, presence of outliers and the ‘curse of dimensionality’ – are overcome. With this study considerable levels of inefficiency were found in the European seaports sector.

The hurdles of local governments with PPP contracts in the waste sector

With this paper we identify a number of the theoretical principles that apply to public—private partnership (PPP) contracts, introducing new case studies and policy discussions relevant for Europe and elsewhere. We discuss to what extent these contracts can and should be applied in the waste sector and perform a comparison between the purely contractual and the institutionalised models of PPP arrangements. We analyse four case studies in the ‘wholesale’ waste market in Portugal and examine the implementation and degree of success of these partnerships in the field. It seems that public authorities are failing to secure an adequate level of protection of the public interest. Drawing on the empirical evidence, we present some guidelines that could lead to better regulatory contracts for waste services.

Influence of Congestion Efficiency on the European Seaports Performance: Does It Matter?

Abstract The increase in cargo transportation has not necessarily corresponded to an improvement in the productive efficiency. Quite on the contrary, particular infrastructures are prone to the congestion phenomenon. In this case, after a given value the increase in inputs can lead to a decrease in outputs. The purpose of this study, based on data envelopment analysis, is twofold. First, it aims to account for the importance of congestion in European seaports. Second, it intends to compare different alternatives to determine this kind of inefficiency. The results show considerable signs of congestion in some European seaports.

Water services performance: do operational environment and quality factors count?

Abstract Decision makers must keep in mind that water services have an invaluable ‘price’ for the public budget and society’s welfare. However, due to the specific features of the service, water utilities are prone to inefficiency. Thus, performance evaluation becomes indispensable to face this constraint. Besides the application of the traditional technique of Data Envelopment Analysis to evaluate the performance of Portuguese water utilities, this study also implements the robust technique of order-m to assess the influence of operational environment on water utilities’ performance. In spite of several reforms, the Portuguese water sector still reveals significant levels of inefficiency, partially caused by an inappropriate operating scale. Concerning the operational environment, it was possible to observe a positive influence of private sector participation, economies of scope, and groundwater sources on efficiency. The influence of the ‘quality of service provided’ was also studied in this performance analysis.

The Market Structure of Urban Solid Waste Services: How Different Models Lead to Different Results

Urban waste services in Portugal have historically been provided together with other services, such as the water services. Despite the lack of discussion on this subject in the literature, some questions have been raised about the gains, in terms of efficiency, of this policy. Following a recent and robust partial nonparametric frontier model, based on order-α, we intend to evaluate the presence of economies of scope in the Portuguese waste sector. Furthermore, we also estimate the economies of scale using the traditional data envelopment analysis. The results show the absence of economies of scope between waste and water (and wastewater) services. In addition, we identify the presence of economies of scale in smaller municipalities. These outcomes might be useful for policy and decision makers in further reforms.

Water Sector Regulation in Small Island Developing States: An Application to Cape Verde

Small Island Developing states (SIDs) present challenges for analysts and policy-makers attempting to strengthen island-nation infrastructure. This study applies lessons to one SID to illustrate how benchmarking can improve the performance of water utilities. The archipelago-nation of Cape Verde is characterized by severe water scarcity and relatively low per capita income (the GDP is the 93th of the world and the 11th of Africa). These national characteristics have been considered the main constraints for the water supply development. Analysts find a close relationship between the socioeconomic conditions of a country and the precarious level of water and wastewater services, including their coverage. Nevertheless, after the creation, in 2003, of a multi-sector regulator, the Economic Regulation Agency (ARE), citizens had high the expectations for improved sector performance. To achieve significant network expansion and cost containment will require the regulator and operators to draw lessons from countries who have successfully addressed water issues despite comparable socioeconomic/hydrologic features. This study provides the rationale for a regulatory model for ARE that is based on benchmarking analysis (for quantifying performance) and yardstick competition (for incentivizing utility managers). The study recommends a design for a performance evaluation system and discusses the major issues associated implementing such a system.

Institutional Development in the Urban Waste Market in Portugal. Market Structure, Regulation and Performance Analysis

Many waste utilities managers and some think-tankers have considered the waste market as one of the best macroeconomic indicators of a country (US.EPA, 1999). They defend that the production of waste is deeply linked to the financial health of the citizens (O’Neil & Locke, 2004) and, therefore, to the financial health at a national level. Figure 1 shows the growth of urban waste in line with the Gross Domestic Product (GDP) and the population (OECD, 2002). The upward trend of waste production occurred at a rate slightly lower than GDP, but well above population growth.