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The Upshot of Autonomy and Efficiency of Urban Water Service Providers in Uganda and Tanzania
The theoretical and empirical debate on the effect of managerial autonomy on the efficiency of urban utilities is still ongoing, yet limited research has been conducted in the water sector in developing countries. The position that an increase in managerial autonomy will cause the likelihood for technical efficiency to decrease, could be expected in the event that the principal (HO) who grants autonomy may not keenly and continuously supervise and monitor the activities of the agent (DMU). Urban water utility managers should put in place an appropriate structural framework to govern the relationship between the water utility HO and the DMU. Besides this, the utility head office should delegate decision making powers to the DMUs based on a clear framework.
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