The Effect of Economic Regulation on Social Tariff Implementation in the Water Sector

A state regulatory agency of the Brazilian water supply and sewage sector conducted inspections of the Social Tariff implementation in more than 500 municipalities with services from its major regulated operator. The regulator established inspections and drafted a regulatory rule to foster this policy implementation. This article analyses the effect of economic regulation on Social Tariff implementation. It introduces an index that denotes the level of Social Tariff implementation. The statistical test results indicate an increase in the Social Tariff implementation in all state regions after regulatory efforts. The econometric model results suggest that the regulation increased this policy implementation. This article contributes to the literature by highlighting the role of economic regulation in pro-poor policy implementation. Furthermore, it contributes by introducing the referred index in the literature so that other regulators can use it to inspect the social tariff implementation