Abstract
Abstract The provision of quasi-public goods along with its price determination is one of the key problems in public finance theory. The focus of this work is on such quasi-public goods as rural drinking water. How to supply safety drinking water to the rural areas becomes more and more imminent because of the serious pollution in the supply network caused by contamination in the soil. Based on a case study for the rural drinking water system in Weihai, we conclude that the main provision mode as the hybrid of the centralized control of governments at the strategic level along with the market forces at the operational level. Moreover, we present a novel pricing mechanism by combining the two-part pricing with the ladder pattern pricing. This work also offers insights into the reform of the quasi-public goods provision and pricing in other areas of China.
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