The interconnection between water quality level and health status: An analysis of Escherichia Coli contamination and drinking water from Nepal

Health outcomes can be remarkably dependent on the quality of drinking water. This study employs primary survey data collected in May 10 – July 27, 2016 to investigate the effects of water quality, measured by the presence of the Escherichia Coli (E. Coli) bacteria, on the health outcomes of households in Nepal. The health outcomes are based on the self-reported health status as well as the actual health condition of the members of the household. The novel contribution of this paper is that we investigate the health impacts of water quality by considering water quality itself as an intermediary process that could be affected by factors like household's cleanliness behaviors and hygienic infrastructures. Using a control function approach to account for potential endogeneity issues, the results indicate a significant effect of E. coli on the health status of individuals. Findings indicate the difference in expected diarrheal incidence to be about 0.913 units higher when E. coli is present in households' drinking water. The impact of E. coli is evident in both the self-reported health status and the actual health outcome, and the results hold across various empirical models and specifications. From a policy perspective, our results indicate the pressing need for policymakers to implement water quality tracking programs, and also to raise awareness among households regarding adequate cleanliness practices and hygiene infrastructures.