The Emergence of Participative Institutions: a Solution for Collective Action Problems or New Structures of Power?

Abstract: For the last two decades, users have been taking active part in the regulation process of water and sanitation services in developing and developed countries. Some examples are well-known, such as the involvement of users in the breach of the Buenos Aires contract in the early 2000’s or in the revelation of the corruption case in Grenoble (France) in the 90’s. Besides or in response to those spectacular actions, institutionalised participation of users has emerged. In France for instance, the legal framework compels local public authorities to consult a committee consisting of politicians and users’ representatives before signing a public-private partnership or in evaluating the service performance every year. The main achievements expected from users’ participation are better transparency and fairer access to the services. However, until now, very few studies have analysed the impact of these new participative institutions on the regulatory governance. From a new institutional economics perspective, it is interesting to question the role of users’ participation in the regulation of water and sanitation services. Are the new participative institutions structures of cooperation that resolve collective action problems in line with the theory of Weingast and Marshall (1988) or Ostrom (1990)? Or are they rather new structures of power benefiting to some groups, the insiders, but being detrimental to the outsiders, in line with the theory of Moe (1990)?