Some of the problem is a political problem. Not so much a corruption problem necessarily. It's the fact that people are used to having water be cheap. They may not be willing to take the chance of paying a higher price in return for guaranteed service.
David Zetland of Leiden University College in the Netherlands and author of Living with Water Scarcity talks with EconTalk host Russ Roberts about the challenges of water management. Issues covered include the sustainability of water supplies, the affordability of water for the poor, the incentives water companies face, and the management of water systems in the poorest countries. Also discussed are the diamond and water paradox, campaigns to reduce water usage, and the role of prices in managing a water system.