Study Overview
While most countries are committed to increasing access to safe water and thereby reducing child mortality, there is little consensus on how to actually improve water services. One important proposal under discussion is whether to privatize water provision. In the 1990s Argentina embarked on one of the largest privatization campaigns in the world, including the privatization of local water companies covering approximately 30 percent of the country’s municipalities. Using the variation in ownership of water provision across time and space generated by the privatization process, we find that child mortality fell 8 percent in the areas that privatized their water services and that the effect was largest (26 percent) in the poorest areas. We check the robustness of these estimates using cause‐specific mortality. While privatization is associated with significant reductions in deaths from infectious and parasitic diseases, it is uncorrelated with deaths from causes unrelated to water conditions.
Study Results
We hypothesized that increased access to the water and sanitation network, and potential changes in service quality, improved health outcomes of young children. Using a combination of methods, we find that child mortality fell by approximately 8 percent in the areas where water systems were privatized. A number of factors lead us to believe that the link between the privatization of water systems and the decrease in child mortality is causal. First, privatization decisions across municipalities and time do not depend on time-varying variables that may also affect mortality rates. Second, the treatment and control groups showed similar trends in the pre-intervention period. Third, water privatization affected child mortality from water-related diseases but it showed no effect on deaths from other causes. Fourth, the impact of privatization was largest in poorest areas.