Privatization and sanitation outcomes: evidence from Brazilian municipalities

This paper estimates the effects of sanitation privatization in Brazilian municipalities (2006–2022) using SDID and SNIS data. Exploiting staggered adoption, we compare treated municipalities/providers to synthetic controls. Privatization raises realized investment flows and boosts productivity in the shorter window, while municipal impacts focus on treatment performance: water treatment rises robustly, and sewage treatment improves at conventional significance levels. Tariff responses are modest, with some evidence of lower water tariffs. Despite limited private participation (around 4% of providers), results indicate that privatization can improve operational performance and treatment quality, providing policy-relevant evidence for universal sanitation under fiscal constraints.