So, what’s utility?

Emma writes*

The goal of economics is to improve the living conditions of people (Mankiw 2019). Hence, economics should focus on increasing human prosperity rather than just increasing material consumption. Of course, material wealth strongly correlates with well-being, as material wealth provides a sense of security, a roof over one’s head, food, and clothing. Yet, empirical evidence shows that this is only necessarily true up to a certain income. In the US, average income almost quadrupled while average happiness decreased That material wealth is not the only factor determining a good life is somewhat common sense. In basic psychology terms, what neoclassical economics concerns with are the “basic needs” in Maslow’s Pyramid of Needs:

Mainstream, neoclassical economics defines utility-maximization – utility being the satisfaction gained from consumption of goods and services – as the ultimate goal of every human. It is true that this is a necessary simplification for economic modelling, as material goods are tangible opposed to utility gained from action fulfilling “psychological needs”. Thus, this is a perfectly fine assumption to hold in the spheres of economics that do not directly require a prior stance on normative beliefs (like, for example, the belief that economic inequality is meritocratically justified because we live in a society with equal access to opportunities), say accounting of econometrics.

The problem is not the use of this assumption ipso facto but that this definition of utility as being formative for human happiness shapes economics and thus permeates into economic policy and shapes everyday economic interaction, set of beliefs, and society. Economics influences not only our access to basic needs but our psychological needs profoundly. It is fundamentally tied to the other social sciences in understanding and providing human prosperity. This is also why – how neoclassical economics proponents may argue – the statement that “psychological needs” are not directly the responsibility of economists, is, frankly, wrong.

To equate utility with material goods worked great in times of material scarcity; as for example after the two World Wars or in developing countries. Yet, in times of material over-abundance in developed countries, an economy governed by this principle may erode the fundamentals necessary for our psychological needs whilst over-providing materials for basic needs. As a great – neoclassical! – economist pointed out, “the art in economics lies in judging when a simplifying assumption clarifies our thinking and when it misleads us.” (Mankiw 2019). The neoclassical definition of utility is a necessary simplification and not a doctrine or even the attempt to fully reflect the nature of humans – but when this assumption may erode, in the very long-run, psychological needs whilst leading to an oversupply for basic needs, this assumption is misleading.
To put it simply, especially in developed countries with a robust welfare state the fixation on material goods seems outdated. A paradigm shift in economics from the emphasis on material goods as utility towards an emphasis of material good and human well-being as utility is necessary. By starting at the root problem with changing the definition, policy change will follow – to something more adequate than GDP maximization and achieving full employment.

Bottom line: The assumption equating utility with human satisfaction and happiness whilst only counting consumption as utility oversimplifies what we mean by human happiness. A paradigm shift in economics from the emphasis on material goods towards an emphasis on human well-being is necessary.

* Please help my Economic Growth & Development students by commenting on unclear analysis, alternative perspectives, better data sources, or maybe just saying something nice :).

When FDI helps development

Bálint writes*

Foreign direct investment (FDI) is a form of cross-border investment in which an investor resident from one economy establishes a long-term interest in and a high degree of influence over a firm registered in another economy. However, FDI does not necessarily help development. For example, FDI can hurt development when foreign firms use it to expropriate natural resources. This post investigates some factors that prevent foreign investors from doing so.

Botswana is one of the few natural resource-rich countries that avoided the resource curse. The central idea is that having point-source, non-renewable resources often contributes to political, economic and social issues.

Botswana does well on all these dimensions. Politically, Botswana is a multiparty democracy with competitive elections. Corruption is quite low. Many social policies are progressive. The legal acceptance of LGBTQ+ representation groups illustrates the extent of human rights progress in Botswana. While the country still struggles with AIDS, they have progressed in combating the disease. Finally, Botswana has done well economically. Their high per capita incomes have not shown the sluggish growth rates characteristic of many resource-rich countries. To summarize, all components of Botswana’s HDI increased consistently since 1990, as the graph below shows.


Botswana suffered from deep poverty and had virtually no infrastructure after independence from the British in 1966. How could they achieve all this growth and development progress? The surface-level answer is that they had prudent economic policies, their politicians cared about the public and they negotiated well with powerful foreign companies.

Knowing that Botswana made the right policy decisions, I invite you to explore the factors that enabled all this success. First, Botswana is ethnically largely homogeneous. Gapa (2013) argued that this homogeneity facilitated trust and peaceful cooperation between the people in positions of power. Better cooperation and more trust mean that foreign powers could not divide society so easily. Thus, foreigners could not rely so much on insiders to help them expropriate natural resources in exchange for a part of the rents.

Furthermore, the Kgotla system facilitated cooperation. Kgotla is a respected traditional institution of participatory democracy in which local leaders are invited to share their views and criticism of those in power freely and directly. The large number of local leaders representing interests across the society of Botswana means that Kgotla passed down information from many people. Thus, a relevant traditional source of accountability remains that hinders government and business officials from disregarding the interests of the population at large. Furthermore, British colonial destruction did not reach this institution. Since locals had been used to it for generations, the Kgotla can be a widely used and understood institution.

Finally, the ruling BDP political party is decentralized. It offers various localized points of entry, such as local assemblies that provide the population with a voice in decision-making. As Gapa (2013) argued, this decentralization helps enhance accountability, leading to more efficient political outcomes. The dynamic is similar to the Kgotla system outlined above, except that a wider population group can participate in the assemblies.

Bottom Line: The case of Botswana suggests that ethnic homogeneity, institutions of accountability and decentralized ruling parties all contribute to a more positive FDI-Development relationship in resource-rich countries.

* Please help my Economic Growth & Development students by commenting on unclear analysis, alternative perspectives, better data sources, or maybe just saying something nice :).

Thailand’s coup-happy military

Andre writes*

The Royal Thai Army is notorious for regularly overthrowing governments, elected or otherwise. The most recent coup took place in May 2014, when the milItary removed the Shinawatra-led government supported by the ‘Red Shirts.’ Since a 1932 coup established the constitutional monarchy that continues to exist today, Thailand has undergone eleven successful coups and experiences an attempted coup every seven years (The Straits Times 2014The Atlantic 2019)

Why does the army continue to overthrow governments?

There are several theories on preventing coups:

  1. There must be a normative understanding that the military should stay out of politics.
  2. The existence of strong non-military organisations (civil society) is a way for society to counter-balance military power.
  3. Institutional arrangements (constitutional design) are aimed at preventing coups.

In Thailand, the frequent coups are a symptom of an underlying and long-running divide between the rural periphery and the royalist-urban middle class centred around Bangkok. They are commonly known as ‘Red Shirts’ and ‘Yellow Shirts’ respectively, which are the colors used in their demonstrations. The conflict within Thailand’s society is central to giving the military a key role in politics.

First, past coups set a clear precedent for further coups, and Thailand holds the world record. Coups are so frequent that they are nothing special. Indeed, the establishment of the constitutional monarchy through military coup gives the military a claim to being part of the internal political order. It is even expected of the military to intervene in political crises (CNBC 2019).

Second, the divide is so strong that the Yellow Shirts have supported what they term ‘pro-democracy’ military coups. This has ensured their position of political and economic privilege while the Red Shirts, on Thailand’s rural periphery, face repression by the military (The Atlantic 2019).

Third, Yellow Shirt civil societies play an important role in supporting and legitimising coups (The Atlantic 2019). Points 1 and 2 of coup-proofing theories are thus negated by a lack of normative agreement that the military should refrain from intervening in politics. The military has thus used the support for its coups to change institutional arrangements in its favour. Currently, the Thai parliament consists of an elected House of Representatives and a Senate. The 250 members of the Senate are chosen by the junta and their consent is required to choose the Prime Minister (The Atlantic 2019).

Fourth, royal support is critical to the success of coups, as the king is revered by Thais. In the past two coups (of 2006 and 2014), the junta was given public support by the king. This legitimacy was arguably key to coup success. In comparison, a coup attempt in 1981 failed as the king supported the incumbent Prime Minister (The Atlantic 2019).

Bottom Line: Thailand’s transition to democracy –despite frequent post-coup elections (which despite being unfair have resulted in anti-coup parties winning) — is ongoing. The difficulty in transitioning to full democracy could be explained by how popular democracy is not in the interest of Thailand’s elites. These consist of the military, the middle class and royalists, who are centred on Bangkok and hold significant economic power – the top 1% hold two thirds of the country’s wealth (Khaosod 2019). Unsurprisingly, these economic elites are unwilling to lose their economic rents and privileges to a government interested in redistribution to the periphery. Without creating an inclusive political system that benefits elites and non-elites, the equilibrium of military rule, or military-influenced rule is likely to continue.

* Please help my Economic Growth & Development students by commenting on unclear analysis, alternative perspectives, better data sources, or maybe just saying something nice :).

Brain drain – the Romanian example

Daria writes*

“Brain drain” is defined as the emigration of highly skilled workers from developing economies to more developed ones. Globalisation and  membership in the European Union have had positive and negative impacts on Eastern European countries, which in the context of liberalisation have become known as human-capital-exporting countries. Unfortunately, the surge in medical personnel, engineers and entrepreneurs working abroad has caused serious damage to the countries of origin that now struggle with dormant economies.

Romania ranks first in emigration among European countries. The 1989 fall of the Communist regime was the first opportunity for Romanians to look for new prospects abroad. However, only following Romania’s EU joining, the brain drain effect started to impede development in specific sectors. The healthcare sector is one in which innovation seems impossible.  More than half of its workers have migrated to Western countries, meaning that those left behind are struggling to meet day-to-day health care demands.

Reports have shown that four out of five Romanian doctors consider working abroad and over 20,000 have left to practice in countries such as the UK or France since 2007. This problem disrupts the country’s development. There is often concern regarding the financial losses, since Romanian taxpayers pay for the education of doctors and nurses. The training of one doctor in Romania costs approximately 100,000 €. These costs deepen the economic disparities between Western and Eastern Europe, but education costs are overlooked during EU budgeting meetings. That oversight may not be accidental when destination countries gain knowledge and economic benefits from such workers.

While long-term economic consequences involve a more elaborate analysis, short-term repercussions are more visible. The brain drain has depleted the healthcare system, with a 20% personnel shortage in Northern Romania The recent outbreak of COVID-19 has exposed the workforce to risk and the weaknesses of the sector. The lack of qualified personnel and scarcity of hospital funding (Romania allocates only 5% of GDP to healthcare) led to unprecedented measures such as closing hospitals in major cities.

Brain drain is often irreversible, so Romania should soon focus on a “brain gain” approach. Various studies have shown that such a strategy might foster and encourage growth . “Brain gain” generates economic gains and knowledge capital. Policies promoting  return-migration would bring experience and skills to the healthcare sector.

Although remittances from the diaspora of 1.9 billion dollars in 2014 helped the economy, monetary gains cannot entirely offset the negative effects of brain drain. As an increasing number of highly skilled Romanians work abroad because of exacerbated income inequalities and corruption in their home country, radical institutional change to encourage “brain gain” is needed.

Bottom Line: Brain drain has little to no positive effects for Romania, especially in the healthcare sector losing trained specialists. Reversing the drain is needed to foster progress and development.

* Please help my Economic Growth & Development students by commenting on unclear analysis, alternative perspectives, better data sources, or maybe just saying something nice :).

Little tax, lots of pressure

Manon writes*

Global issues like climate change require governments to invest in ways that will cost them in the present to hopefully provide a better future. But, investing in the future is a lot harder when you are already struggling with investing in the present. The wealthiest of countries are having a hard time making such a change. For low-income countries, it seems near impossible due to a lack of government capacity.

The original Kuznets curve illustrates that as a country goes through economic development, inequality will first increase. When, due to economic growth, the government has a high enough revenue through taxes, it can set up a welfare system and inequality will go down again. The environmental Kuznets curve is based on the original curve and argues that as a country develops, pollution will first go up. However, when the country reaches a certain level of economic growth, pollution will go down again through technical innovation and switching from fossil fuels to green energy.

However, climate change is knocking on everyone’s door, albeit often a bit more urgently on those of poorer countries. Countries that have not reached the level of economic development that the environmental Kuznets curve talks about are being forced to deal with climate change before they are, in a sense, ready. This force is coming from either them being directly affected by climate change or through international pressures, such as the UN’s Sustainable Development Goals.

Low-income countries often do not have the capacity to invest in the future as their tax revenue is still low. They have not reached the point of economic development in the original Kuznets curve where they have enough tax revenue to set up a welfare system, let alone to invest in the future. A big struggle in raising the needed tax revenue to finance public spending in low-income countries is that the economy is largely informal. Many people have a varying income and are often paid in cash, making income tax hard to implement. Consumer taxes are equally hard because many people shop at smaller stores that might not keep an accurate account of sales and inventories. In such a situation, one would ideally tax the rich more heavily than the poor as they often have a more formal and constant income or assets to tax. However, these figures often have considerable political sway to prevent them from being taxed more. Furthermore, creating an administrative body that is well-educated, well-trained and well-paid has proven difficult as there is a lack of funding, coming from a lack of tax revenue. As you can see, a rather vicious cycle occurs.

Low-income countries that are still very much to the left of the turning point in any Kuznets curve are thus being pressured to make changes surrounding climate change that they cannot afford due to low tax revenue. Furthermore, these changes will most likely hurt current economic activity in the country, leading to an even larger need for public spending and simultaneously even less tax income.

Bottom line: Countries all over the world will have to work together to combat climate change by making some necessary adjustments to the way we live. Countries that do not have the capacity, due to a lack of tax revenue, to provide welfare will also be the countries that will struggle most with these adjustments.

* Please help my Economic Growth & Development students by commenting on unclear analysis, alternative perspectives, better data sources, or maybe just saying something nice :).

e-Estonia: The Paperless Government

Anzelika writes*

Estonia has become a global model for e-government, having created a secure, transparent and efficient digital platform, where both businesses and citizens can access necessary governmental services online.

Estonia is a small Baltic country located in Northern Europe. Gaining independence from the Soviet Union just under 30 years ago, Estonia has emerged to be one of the wealthiest countries in the world. Between the years 2001 and 2007, Estonia showed one of the highest GDP growth rates in Europe [pdf], currently is number 30 out of 189 countries in Human Development Index and (ranks higher in Economic Freedom than the United States or the Netherlands.

Estonia’s economic success can, in part, be attributed to its innovative way of governing society. Estonia has been able to build the world’s first paperless government – e-Estonia.  Today 99 percent of all Estonian state services can be accessed online, 98 percent of Estonian citizens have an electronic ID card, and more than 45 percent of the population use internet voting. Estonia has further introduced what has been termed as e-Residency. It is a transnational digital identity that can be used by anyone in the world to get access to Estonia’s digital technologies, including legal or accounting services, and the entrance to the EU business environment. This makes Estonia one of the most advanced digital societies in the world, and it comes with its benefits.

For example, moving government services online has dramatically reduced corruption. The problem of corruption was of particular concern back in 1994, when e-Estonia was first introduced. By moving essential state services online, it has meant that interaction between government officials and citizens has dramatically reduced, eliminating most bribery. This issue still plagues many of the post-Soviet countries.

Further, the ease of starting a business online together with the e-Residency program has allowed Estonia to become Europe’s leading startup hub. Estonia currently has 31 startups per 100,000, which ranks 6 times higher than the EU average. Companies such as Skype and TransferWise have emerged in the tiny Baltic State. Not only do these startups contribute to Estonia’s economic growth, the favourable economic climate for businesses has also attracted significant levels of FDI to the country.

As governments around the world seek to improve their economies, they should look towards the small Baltic state that can serve as a blueprint for the effectiveness of a digital society. As the Estonian MEP Marina Kaljurand has stressed: “if used properly, digital solutions can be essential drivers for economic growth and equity.”

Bottom line: Estonia has been able to successfully create e-government, which in part has helped the country emerge as one of the most advanced economies of the world.

* Please help my Economic Growth & Development students by commenting on unclear analysis, alternative perspectives, better data sources, or maybe just saying something nice :).

Iqaluit: The True North Strong & Thirsty

Stephanie writes*

Climate change tells us the Earth is melting. For Canada’s economy, this damage has a silver lining: increased accessibility to the Arctic. Technology improvement in conjunction with more favorable climate means that there is new industrial potential for the Arctic. Canada is in disputes with Denmark, Russia, and the United States over who has territorial rights of the seabed, having officially submitted their argument to the UN in 2019. The federal government wants a stronger presence in the North to back up their claims. This formed their motivation for building Canada’s first deepsea arctic port in Iqaluit.

However in recent years, Iqaluit – the capital city of Nunavut, Canada’s largest northern territory – has been consistently making national news – not for its geopolitical significance in Canada’s territorial claims, but for its water shortages.

The past two summers Iqaluit has had to declare a water emergency. The city’s small population of 8,000 relies on one reservoir, Lake Geraldine, for its freshwater. Despite renovations in 2010 to increase its capacity, the summer of 2019 saw its record low. Both summers, the city had to issue car washing bans, PSAs pleading residents to take showers instead of baths, and in 2018 the opening of a brewery had to be delayed.

Maybe we should rephrase Benjamin Franklin’s famous quip: “When the beer shelves are empty, we know the worth of water”.

If the city’s water supply can’t provide for a small-scale brewery, how can it be expected to support the rapidly increasing population, never mind the country’s weighty political agenda?

A 2015 report said the reservoir has a capacity to support 8,300 people, but population is predicted to rise to 13,050 by 2030. The city’s water license has been amended to allow pumping from a neighboring watershed to the Lake Geraldine reservoir but only until 2026. Many fear this is just a band-aid fix to a greater issue: climate change.

Looking to the future, things get frightening:

  • The Arctic has experienced the most intense temperature increases in the world. An analysis of the last 30 years of meteorological data shows a 6.9% decrease in summer precipitation per decade in Iqaluit specifically. The Arctic relies almost exclusively on precipitation to recharge water supply, so headlines of “The Reservoir is at a Record Low” seem like they’ll become the new normal.
  • Permafrost is melting – leaving infrastructure in a precarious situation and literally draining lakes. Before the city sent a water task force to fix major leaks, it was claimed that “40% of the city’s drinkable water was wasted through aging infrastructure”.

With the environment changing so fast, how can a city of 8000 be expected to keep up?

Bottom Line: Canada’s political vision for this city is delusional when the constraints of water supply are considered.

* Please help my Water Scarcity students by commenting on unclear analysis, alternative perspectives, better data sources, or maybe just saying something nice 🙂

Should Adelaide desalinate more water?

Nik writes*

Adelaide lies at the mouth of the Murray River, where Australia’s largest river system, the Murray-Darling Basin, meets the ocean. Today, the Murray River is struggling. It is being diverted at an unsustainable rate, mostly by farmers, as its tributaries make their way through four Australian states and at the capital territory before joining the Murray River and flowing into South Australia and Adelaide.

For decades in the 20th century, Australian state governments were handing out water rights left and right to farmers across the basin. By the 90s the Murray River mouth was silting up, threatening Adelaide’s water supply. The Millennium drought from the late 90s to 2010 added even more pressure on the ecological well-being of the river system and the people who depend on it.

At the height of the drought, in 2007, two important things happened. The Australian government passed the Water Act and Adelaide announced plans for a desalination plant. The Water Act gave birth to the Murray-Darling Basin Plan of 2012, which aimed to recover 2,750 gigalitres of water from irrigation back into the river system. Adelaide’s desalination plant was to provide water security to Adelaide and beyond.

As the health of the Murray River is threatened today, could this desalination plant be the silver bullet needed for Adelaide, other users in the Murray-Darling Basin, and the river itself?

With its capacity to produce 100 gigalitres per year, the idea is that supplying this water to the people of Adelaide could free up water allocations for users upstream. There is room to ramp up desalination. Currently the plant is at minimum output, even shutting off during wet seasons. And though desalination is relatively expensive, the Australian government said it would step in and subsidise the water for farmers upstream. While users in Adelaide would pay their ordinary price of around 2.00 USD per 1000 litres, farmers upstream would pay less than 0.07 USD per 1000 litres for the allocation.

But like any solution, there are costs. Most obviously, there is the difference between the production costs of desalination (0.63 USD per 1000 litres) and its price (0.07 USD per 1000 litres), a gap that taxpayers will cover. Additional allocations of surface water in the basin at extremely low prices will harm the health of the river system and won’t incentivize saving water. It is important for the health of the river, and for the ocean that the Murray River reaches the ocean, which it does less than 90% of the time.

If not desalination, then how can Adelaide and upstream users get enough water while ensuring the river flows? The Murray-Darling Basin Plan has so far spent nearly 4 billion USD on recovering water from irrigation, two thirds of which has gone to subsidising irrigation infrastructure. There is no evidence so far that this has increased river flows at all. On the upside, scientist analysed Australian government data and found that the government buying water from irrigators is far more efficient.

Bottom line: Adelaide’s desalination plant is not the silver bullet that will save the Murray-Darling Basin, because the allocations it would free up ultimately harm the basin and the beings that depend on its health. Policy makers should instead look for ways to incentivise users to reduce their consumption.

* Please help my Water Scarcity students by commenting on unclear analysis, alternative perspectives, better data sources, or maybe just saying something nice 🙂

La Paz at risk of drying out

Lea writes*

Since the turn of the century, water management in Bolivia has been a never-ending rollercoaster of shifting governance and responsibility. Previously, inhabitants of El Alto and La Paz experienced resource shortages and horrendous water quality due to corruption under the service of the private company “Aguas de Illimani”. The situation became so drastic that citizens began to strike and demonstrate against private water. Known as the water wars, individuals nationwide demanded a reformation of the water management. As a consequence of a political socialist uprising during that time period, water was finally proclaimed a human right in 2009 under the newly elected president Evo Morales. The right of water regulation was transferred to EPSAS, a public wastewater and metropolitan drinking water company.

People were hopeful the situation would finally change, however it never really did. In November 2016, La Paz and El Alto experienced their worst water scarcity crisis to date. A combination of low precipitation, high temperatures leading to increased glacier melting, and intensified southern oscillation of El Niño forced the company to ration water supplies for two months. La Paz has yet to recover from the drought and the government still struggles to provide safe, sufficient and easily accessible water for all sectors of the city.

La Paz and El Alto receive their water supply from the mountain catchments in Cordillera Real. Three main dams (Inkachaka, Ajunkota and Hampaturi dams) stationed within this region capture glacial meltwater which is then passed through four different treatment plants. However, water levels are falling due to increasing population, intensive industrialization and climate change. Households have experienced improvement in the water supply, but especially in rural areas they are still struggling to be supplied with water. El Alto’s and La Paz’s unique geographical characteristics due to being situated in the basin of the Andes Mountain range significantly complicates the challenge of water distribution 3600 meters above sea level. As early as 2025, the water system supplying El Alto specifically is expected to have severe water shortages.

Bottom Line: Privatization and municipalization have both failed to resolve the water crisis and deliver adequate living conditions to the population. Appropriate or innovate approaches need to be taken instead to ensure sustainable and fair management of the resource if the citizens still want to have sufficient water resources in the future. Pipes need to be restored, water lines extended, waste water plants made more efficient. National taxes can be augmented to cover the costs of the system renewal and avoid dependence on external support. Most importantly, a competent and motivated organization must attempt to effectively take into consideration economic, social, political and geographical challenges of water management in La Paz and El Alto and commit themselves to saving the habitants of this unique city from a rigorous drought.

* Please help my Water Scarcity students by commenting on unclear analysis, alternative perspectives, better data sources, or maybe just saying something nice 🙂

Itzapalapa’s water trucks

Anna writes*

Water supply in Mexico City is a good indicator of the persisting inequality, as residents have to live with very different amounts of waters in this city of water scarcity. In Itzapalapa, the most populous and poorest district in the city’s east, people face severe water shortages. Therefore, their daily water supply is often brought by water tanks – or not. Whereas pipe pressure in rich districts like Cuajimalpa is about 14kg per cm² – enough to irrigate numerous golf courses – in Itzapalapa peoples’ pipes have a pressure of only 0,50kg per cm², which leads to dry taps and thus water scarcity. Due to the numerous leaks in the pipe system around 40% of the water that runs through the pipes is lost, which makes it extremely inefficient, but the funds that would be needed to renew the underground pipe system are immense. Thus, people in Itzapalapa must proportionally invest a lot of money and time to find and get water of acceptable quality. Alejandra Salgada, resident of Itzapalapa, estimates that about one fifth of their family’s income is spent on water, which makes them consider leaving the city because they can’t afford their life there.

Sometimes parents like Silvestre Fernandez have to choose between buying new diapers for their toddlers or buying water, which illustrates the severity of the situation in Itzapalapa. The district relies on the supply of water from 1000 tanks. The alternative to the tanks is getting water downhill from a municipal tap, that then needs to be transported on donkeys all the way uphill. Not only the residents suffer from the water scarcity, but the drivers of the tanks called pipas feel the negative consequences when they are threatened by desperate residents with guns and dry taps. This hopelessness for water also leads to water theft in form of illegal tank fillings. Apart from that, even if water reaches Itzapalapa it is often untreated and of low quality, which leads to health issues.

In order to relieve the miserable situation of water supply in Itzapalapa Clara Brugada, the mayor of this district plans to make use of the nearby located Xico lake to supply Itzapalapa with water. She wants the 600,000 residents of Itzapalapa who partially receive water only every week or two to have regular access through piped distribution. Apart from this possible solution, several pilot projects are under development to deal with the water crisis in Mexico-city. One of them is the rainfall catchment project, already realized in 25 schools in Santa Catarina, a part of Itzapalapa, which has been implemented by the Metropolitan Autonomous University of Iztapalapa. It allows the schools to be independent of water supply, as long as there is precipitation, whereas half of the water can be used in the school and the other half is used to replenish the degraded aquifer under Mexico-City. Unfortunately, those smaller scale sustainable possible solutions are often opposed by SACMEX, Mexico city’s water operator, which prefers larger-scale and more expensive solutions.

Bottom Line: There’s a need for new solutions and new policies if the water scarcity of Itzapalapa (and Mexico City) is going to be addressed.

* Please help my Water Scarcity students by commenting on unclear analysis, alternative perspectives, better data sources, or maybe just saying something nice 🙂