Zero subsidy approaches … a barrier to the poor?
Interesting report from the Poverty Action Lab that presents overall findings (from a series of RCTs) on the impact of charging small fees to poor users of essential (primarily medical) products (‘The Price is Wrong’). The findings – in short – that charging even very low fees has a negative impact on uptake by the poor – and no discernable positive impact.
Which is very interesting, and triggers the question – if ‘zero subsidy’ approaches don’t work for essential products like medicines, bed-nets, water treatment chemicals or soap – why would they work for latrines/sanitation? Which makes me wonder whether CLTS has ever been ‘trialed’ against traditional ‘sanplats and masons’ approaches to delivering sanitation. Interestingly, it seems WSP may be doing something along these lines – at least doing trials of both CLTS and Sanitation Marketing – the question being against what?
We can agree to disagree on whether we should or shouldn’t subsidise ‘middle-income’ families to adopt behaviours that – after all – have considerable public-health benefits. But refusing to subsidise the poorest … well – according to this work – it seems the evidence doesn’t support it ..
patrickmoriarty 
Hi Patrick. I think you’ve hit on a meme here that needs more explication. In a word, I’d love to hear your thoughts about the economic view of sanitation, broken down into public and private goods, whereby the private household ‘should’ pay for household level toilets, because of the (perceived) private benefit, vs. the ‘public’ costs (and subsidies) of taking the waste away from the house. This paradigm works on the surface where there is water-borne sanitation and strong governance, but even then the externalities associated with environmental degradation from sewage remain externalized.
What are alternatives to this view of public and private goods? How can we as DPs take the hint that neo-classical economics is not an appropriate foundation for development work?