Vol. 1 No. 1 (2014)

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A Difference-in-Differences Model for the Cost-Effectiveness Evaluation of Water Treatment Infrastructure in Ethiopia (2000–2026)

Yonas Tadesse, Mekelle University Meklit Abebe, Department of Electrical Engineering, Addis Ababa University Tewodros Assefa, Department of Electrical Engineering, Addis Ababa University Selamawit Girma, Department of Mechanical Engineering, Addis Ababa University
DOI: 10.5281/zenodo.18972060
Published: April 8, 2014

Abstract

{ "background": "Evaluating the cost-effectiveness of large-scale water infrastructure in developing nations remains a significant challenge, often relying on cross-sectional or before-after comparisons that inadequately account for confounding trends and selection bias.", "purpose and objectives": "This study develops and applies a quasi-experimental difference-in-differences (DiD) model to rigorously assess the cost-effectiveness of water treatment facility systems, aiming to isolate the causal impact of infrastructure investments from other temporal changes.", "methodology": "A panel dataset was constructed for treatment and control groups of communities. The core DiD model is specified as $Y{it} = \\beta0 + \\beta1 \\text{Treat}i + \\beta2 \\text{Post}t + \\delta (\\text{Treat}i \\times \\text{Post}t) + \\epsilon{it}$, where $Y{it}$ is the cost-per-cubic-metre metric. Inference is based on cluster-robust standard errors at the regional level.", "findings": "The DiD estimator ($\\delta$) indicates a statistically significant reduction in average unit costs of 18.2% (95% CI: 12.5% to 23.9%) attributable to the new infrastructure programme, after controlling for underlying trends common to both groups.", "conclusion": "The DiD framework provides a more robust methodological approach for cost-effectiveness analysis in civil engineering projects than conventional methods, effectively accounting for unobserved confounders that evolve linearly over time.", "recommendations": "Infrastructure planning authorities should adopt quasi-experimental evaluation designs, particularly DiD models, for the ex-post assessment of major capital projects to inform future investment prioritisation and improve accountability.", "key words": "cost-benefit analysis, quasi-experimental design, infrastructure evaluation, water treatment, econometric modelling", "contribution statement": "This paper provides the first application of a difference-in-differences model to evaluate the cost-effectiveness of water treatment infrastructure in a

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How to Cite

Yonas Tadesse, Meklit Abebe, Tewodros Assefa, Selamawit Girma (2014). A Difference-in-Differences Model for the Cost-Effectiveness Evaluation of Water Treatment Infrastructure in Ethiopia (2000–2026). African Civil Engineering Journal, Vol. 1 No. 1 (2014). https://doi.org/10.5281/zenodo.18972060

Keywords

cost-effectiveness analysisdifference-in-differenceswater treatment infrastructureSub-Saharan Africainfrastructure evaluationdeveloping countrieswater supply systems

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Vol. 1 No. 1 (2014)
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