Italian regulatory reform and water utility performance: an impact analysis

Abstract

The Italian water sector has changed substantially over the past ten years. This study assesses the impact of the latest water sector regulatory reform, which follows a performance-based approach, using utility financial data. To understand the effects of reform on the sector, we analyze the performance of 136 Italian water utilities during 2009–2014. To this end, this study employs the non-parametric Luenberger productivity indicator, which shows improvement only between 2012 and 2013. The findings indicate the need for incentives for cost saving and productivity improvement, as well as the need for more investment.