What is the Equity-Efficiency Tradeoff When Maintaining Wells in Rural Haiti?

Abstract

This paper quantitatively compares water infrastructure interventions that prioritize equity with those that prioritize efficiency. The community-based model developed by Haiti Outreach (HO) trains communities to operate and maintain wells, and has clear efficiency gains over the status quo aid model in Haiti that gives communities wells: HO’s wells were 8.7 percentage points more likely to be functioning after one year than similarly-constructed wells managed under the status quo model. Because HO’s model includes user fees, which raise concerns about equity, I quantify the equity-efficiency tradeoff posed by community-based and aid interventions by determining the preferences of a social planner indifferent between these types of water infrastructure interventions. Since HO’s user fees are only 0.6 percent of median income in rural Haiti, under most specifications the efficiency gains of the community-based model outweigh the equity concerns addressed by the aid model.