It is often argued that investments in water supply and sanitation (WSS) generate wide-ranging
economic benefits. At the household level, improved access to WSS is expected to lead to significant
improvements, not only in human health and welfare but also in levels of production and
productivity. Because of these wide-ranging effects, investments in WSS are considered important
instruments for poverty reduction but, while the expected benefits from investments in WSS are
considerable, empirical evidence to support this remains quite limited. This study presents micro
evidence, from a survey of 1500 households in Eastern Hararghe (Ethiopia), which enables a better
understanding of the impacts of improved WSS access on health, timesaving and productive
employment and poverty. Conclusions are drawn and policy implications discussed.
We find that access to improved water supply has a strong statistical association with increased
volume of water consumed per household and a decrease in the average time spent fetching water.
Both effects point to a significant timesaving of the household members responsible for fetching
water. Household members with access to an improved source are more likely to participate in
off/non-farm employment. Interestingly, households with access to improved water supply and
productive water use (irrigation) have significantly lower overall and food poverty levels in terms of
incidence, depth and severity. Our results also show that access to an improved water source
significantly reduces the probability of illnesses, even more so if it is the source is located close by.
We also find that improved water supply leads to a significant reduction in households’ health
expenditures. On the other hand, improved access also seemed to have a positive association with
water-related illnesses, calling perhaps for mitigative measures to reduce incidence of water-related
diseases.
This evidence clearly shows that improving access to water supply infrastructure alone is not
sufficient to bring about desired public health benefits. Therefore, the pathways through which
improved access to water supply has impacted poverty reduction in the study areas have to do with
direct improved health benefits and through timesaving-induced increased participation of households
in off/non-farm employment. Determinants of off/non-farm employment and poverty were also
systematically analysed and factors identified; recommendations are made to enhance these poverty
impacts of water supply improvements.