Public Preferences for Air Quality Improvement: Are More Exposed More Likely to Pay?
Description
This study examines the role of individual exposure to air pollution on willingness to pay (WTP) for clean air while, to the best of our knowledge, offering the first empirical evidence of stated public demand for ambient air quality improvement in Nepal. Besides, this study also investigates the relationship between WTP and public awareness of air pollution-induced costs. We use the double-bounded dichotomous choice (DBDC) contingent valuation method to estimate public WTP for air quality improvement to the level that decreases the chances of air pollution-related morbidity by 50% using survey data of 610 households. We also employ spatial econometric models to understand the spatial distribution of public WTP and control for the spatial spillover effects. Accounting for preference uncertainty and protest responses, we find that people predominantly express a ‘not in my backyard’ attitude as those who live in areas with higher road density and brick-kilns are significantly more likely to pay for clean air. On the contrary, outdoor workers are less willing to pay, despite being more exposed and affected by air pollution. We also find awareness about the health and socioeconomic costs of air pollution to be strongly correlated with positive WTP. Using our preferred DBDC model, we estimate an annual mean public WTP value of NRs. 774.72 (~USD 6.6), which equals 0.43% of the household income.
Public Preferences for Air Quality Improvement: Are More Exposed More Likely to Pay?
This study examines the role of individual exposure to air pollution on willingness to pay (WTP) for clean air while, to the best of our knowledge, offering the first empirical evidence of stated public demand for ambient air quality improvement in Nepal. Besides, this study also investigates the relationship between WTP and public awareness of air pollution-induced costs. We use the double-bounded dichotomous choice (DBDC) contingent valuation method to estimate public WTP for air quality improvement to the level that decreases the chances of air pollution-related morbidity by 50% using survey data of 610 households. We also employ spatial econometric models to understand the spatial distribution of public WTP and control for the spatial spillover effects. Accounting for preference uncertainty and protest responses, we find that people predominantly express a ‘not in my backyard’ attitude as those who live in areas with higher road density and brick-kilns are significantly more likely to pay for clean air. On the contrary, outdoor workers are less willing to pay, despite being more exposed and affected by air pollution. We also find awareness about the health and socioeconomic costs of air pollution to be strongly correlated with positive WTP. Using our preferred DBDC model, we estimate an annual mean public WTP value of NRs. 774.72 (~USD 6.6), which equals 0.43% of the household income.