Physical limits to fresh water expansion--an emerging reality in
many parts of the world--make absolute water scarcity inevitable.
The inability of the already developed water supply to meet an
ever-growing demand for fresh water also makes the emergence of
relative water scarcity unavoidable. Water scarcity--both in its
absolute and relative forms--gets accentuated further by an
increasing premium attached to water quality and ecological
sustainability. The water sector has undergone remarkable changes
in recent years. While past achievements were associated mainly
with investment in new physical structures, recent developments in
the water sector are associated to a greater extent with improved
management and institutional changes. Although both the nature and
direction of these institutional changes vary by country-specific
economic, political, cultural and resource realities, there are
clearly identifiable trends and patterns. This report suggests a
new methodology to shed light on the process of
institution-performance interaction. It demonstrates the use of the
methodology by applying it to an extensive cross-country data set,
and by deriving policy guidance based on the results. The authors
aim to stimulate thought and debate about methodologies and
strategies to be used in order to evaluate institutional change and
institution-performance interactions in the water sector.
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