Evaluating economic impacts of water deprivation in humanitarian relief distribution using stated choice experiments

Abstract

This paper proposes a methodology to quantify the economic impacts of relief distribution after disasters based on discrete choice models. The research uses stated choice data about preferences for water purchases under different scenarios of deprivation. The economic impacts are estimated as the change in consumer surplus caused by the deprivation. The estimated models show that the social benefits for timely delivery of critical supplies are considerably larger than the market price under normal conditions. The findings suggest that disregarding the effects of deprivation, or incorrectly estimating the economic value of critical supplies such as water, is bound to produce a significant miss-allocation of resources. The results produced in this paper could be integrated into economically consistent humanitarian logistics mathematical models that could lead to optimal allocation and distribution of critical supplies.