IDEAS home Printed from https://ideas.repec.org/a/spr/envpol/v19y2017i4d10.1007_s10018-016-0178-x.html
   My bibliography  Save this article

Is willingness to pay for freshwater quality improvement in Pakistan affected by payment vehicle? Donations, mandatory government payments, or donations to NGO’s

Author

Listed:
  • Syed A. Shah

    (KPK Agricultural University Peshawar)

  • Dana L. K. Hoag

    (Colorado State University Fort Collins)

  • John Loomis

    (Colorado State University Fort Collins)

Abstract

This study examines the effect of payment vehicle and managing agency on household’s stated willingness to pay (WTP) for freshwater quality improvement in Pakistan’s Swat River valley. Contingent valuation questions scenarios were designed based on three different payment mechanisms; a mandatory payment to government, a donation to government and a donation to a local non-government organization (NGO). Results show that zero WTP response rate is lower significantly for donation to a local NGO compared to mandatory and voluntary payments to government. Household’s annual donation to a local NGO is $2.8, which is almost double to mandatory and voluntary payments to government. Interviews indicate that this difference might be due to households’ lack of trust of the government programs or fear of corruption, or might be a strategic response to overstate actual WTP when asked about donations to an NGO. The implications for contingent valuation researchers looking to value WTP in poverty dominated areas are that a donation to a local NGO can be used as one payment vehicle to obtain an upper bound on WTP and a mandatory payment to the government can be used as a lower bound.

Suggested Citation

  • Syed A. Shah & Dana L. K. Hoag & John Loomis, 2017. "Is willingness to pay for freshwater quality improvement in Pakistan affected by payment vehicle? Donations, mandatory government payments, or donations to NGO’s," Environmental Economics and Policy Studies, Springer;Society for Environmental Economics and Policy Studies - SEEPS, vol. 19(4), pages 807-818, October.
    • Handle: RePEc:spr:envpol:v:19:y:2017:i:4:d:10.1007_s10018-016-0178-x
    DOI: 10.1007/s10018-016-0178-x
    as

    Download full text from publisher

    File URL: http://link.springer.com/10.1007/s10018-016-0178-x
    File Function: Abstract
    Download Restriction: Access to the full text of the articles in this series is restricted.
    File URL: https://libkey.io/10.1007/s10018-016-0178-x?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. Whittington, Dale & Lauria, Donald T. & Mu, Xinming, 1991. "A study of water vending and willingness to pay for water in Onitsha, Nigeria," World Development, Elsevier, vol. 19(2-3), pages 179-198.
    2. Loomis John & Lockwood Michael & DeLacy Terry, 1993. "Some Empirical Evidence on Embedding Effects in Contingent Valuation of Forest Protection," Journal of Environmental Economics and Management, Elsevier, vol. 25(1), pages 45-55, July.
    3. Richard T. Carson, 1997. "Contingent Valuation: Theoretical Advances and Empirical Tests Since the NOAA Panel," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 79(5), pages 1501-1507.
    4. KyeongAe Choe & Dale Whittington & Donald T. Lauria, 1996. "The Economic Benefits of Surface Water Quality Improvements in Developing Countries: A Case Study of Davao, Philippines," Land Economics, University of Wisconsin Press, vol. 72(4), pages 519-537.
    5. Timothy C. Haab & Matthew G. Interis & Daniel R. Petrolia & John C. Whitehead, 2013. "From Hopeless to Curious? Thoughts on Hausman's "Dubious to Hopeless" Critique of Contingent Valuation," Applied Economic Perspectives and Policy, Agricultural and Applied Economics Association, vol. 35(4), pages 593-612.
    6. Ivehammar, Pernilla, 2009. "The Payment Vehicle Used in CV Studies of Environmental Goods Does Matter," Journal of Agricultural and Resource Economics, Western Agricultural Economics Association, vol. 34(3), pages 1-14, December.
    7. Le Trong Hung & John B. Loomis & Vu Tien Thinh, 2007. "Comparing money and labour payment in contingent valuation: the case of forest fire prevention in Vietnamese context," Journal of International Development, John Wiley & Sons, Ltd., vol. 19(2), pages 173-185.
    8. Dale Whittington, 2002. "Improving the Performance of Contingent Valuation Studies in Developing Countries," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 22(1), pages 323-367, June.
    9. Loomis, John & Kent, Paula & Strange, Liz & Fausch, Kurt & Covich, Alan, 2000. "Measuring the total economic value of restoring ecosystem services in an impaired river basin: results from a contingent valuation survey," Ecological Economics, Elsevier, vol. 33(1), pages 103-117, April.
    10. Zhongmin, Xu & Loomis, John & Zhiqiang, Zhang & Hamamura, Kuino, 2006. "Evaluating the performance of different willingness to pay question formats for valuing environmental restoration in rural China," Environment and Development Economics, Cambridge University Press, vol. 11(5), pages 585-601, October.
    11. Echessah, Protase N. & Swallow, Brent M. & Kamara, Damaris W. & Curry, John J., 1997. "Willingness to contribute labor and money to tsetse control: Application of contingent valuation in Busia District, Kenya," World Development, Elsevier, vol. 25(2), pages 239-253, February.
    12. Shyamsundar, Priya & Kramer, Randall A., 1996. "Tropical Forest Protection: An Empirical Analysis of the Costs Borne by Local People," Journal of Environmental Economics and Management, Elsevier, vol. 31(2), pages 129-144, September.
    13. Wiser, Ryan H., 2007. "Using contingent valuation to explore willingness to pay for renewable energy: A comparison of collective and voluntary payment vehicles," Ecological Economics, Elsevier, vol. 62(3-4), pages 419-432, May.
    14. Peter A. Diamond & Jerry A. Hausman, 1994. "Contingent Valuation: Is Some Number Better than No Number?," Journal of Economic Perspectives, American Economic Association, vol. 8(4), pages 45-64, Fall.
    15. Cameron, Trudy Ann & Huppert, Daniel D., 1989. "OLS versus ML estimation of non-market resource values with payment card interval data," Journal of Environmental Economics and Management, Elsevier, vol. 17(3), pages 230-246, November.
    16. Patricia A. Champ & Nicholas E. Flores & Thomas C. Brown & PJames Chivers, 2002. "Contingent Valuation and Incentives," Land Economics, University of Wisconsin Press, vol. 78(4), pages 591-604.
    17. Guy Garrod & Kenneth G. Willis, 1999. "Economic Valuation of the Environment," Books, Edward Elgar Publishing, number 1368.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Bing Yu & Yuying Cai & Laiqun Jin & Bisheng Du, 2018. "Effects on Willingness to Pay for Marine Conservation: Evidence from Zhejiang Province, China," Sustainability, MDPI, vol. 10(7), pages 1-17, July.
    2. Haefele, Michelle A. & Loomis, John B. & Lien, Aaron M. & Dubovsky, James A. & Merideth, Robert W. & Bagstad, Kenneth J. & Huang, Ta-Ken & Mattsson, Brady J. & Semmens, Darius J. & Thogmartin, Wayne E, 2019. "Multi-country Willingness to Pay for Transborder Migratory Species Conservation: A Case Study of Northern Pintails," Ecological Economics, Elsevier, vol. 157(C), pages 321-331.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Godwin Kofi Vondolia & Håkan Eggert & Ståle Navrud & Jesper Stage, 2014. "What do respondents bring to contingent valuation? A comparison of monetary and labour payment vehicles," Journal of Environmental Economics and Policy, Taylor & Francis Journals, vol. 3(3), pages 253-267, November.
    2. Godwin Kofi Vondolia & Håkan Eggert & Ståle Navrud & Jesper Stage, 2014. "What do respondents bring to contingent valuation? A comparison of monetary and labour payment vehicles," Journal of Environmental Economics and Policy, Taylor & Francis Journals, vol. 3(3), pages 253-267, November.
    3. Ahlheim, Michael & Frör, Oliver & Heinke, Antonia & Duc, Nguyen Minh & Dinh, Pham Van, 2010. "Labour as a utility measure in contingent valuation studies: how good is it really?," FZID Discussion Papers 13-2010, University of Hohenheim, Center for Research on Innovation and Services (FZID).
    4. Diriba Abdeta, 2022. "Households' willingness to pay for forest conservation in Ethiopia: A review," Journal of Forest Science, Czech Academy of Agricultural Sciences, vol. 68(11), pages 437-451.
    5. Richard T. Carson, 2011. "Contingent Valuation," Books, Edward Elgar Publishing, number 2489.
    6. Graça, Manjate, 2018. "Scope effects in contingent valuation: an application to the valuation of irrigation water quality improvements in Infulene Valley, Mozambique," Research Theses 334752, Collaborative Masters Program in Agricultural and Applied Economics.
    7. J. M. Gibson & D. Rigby & D. A. Polya & N. Russell, 2016. "Discrete Choice Experiments in Developing Countries: Willingness to Pay Versus Willingness to Work," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 65(4), pages 697-721, December.
    8. Voltaire, Louinord, 2012. "Effet d’une taxe et d’un droit d’entrée sur les consentements à payer des touristes pour de nouvelles réserves naturelles dans le golfe du Morbihan," Revue d'Etudes en Agriculture et Environnement, Editions NecPlus, vol. 92(02), pages 183-209, October.
    9. Ahlheim, Michael & Frör, Oliver & Nguyen Minh Duc & Rehl, Antonia & Siepmann, Ute & Pham Van Dinh, 2017. "Labour as a utility measure reconsidered," Hohenheim Discussion Papers in Business, Economics and Social Sciences 03-2017, University of Hohenheim, Faculty of Business, Economics and Social Sciences.
    10. Baranzini, Andrea & Faust, Anne-Kathrin & Huberman, David, 2010. "Tropical forest conservation: Attitudes and preferences," Forest Policy and Economics, Elsevier, vol. 12(5), pages 370-376, June.
    11. Ojeda, Monica Ilija & Mayer, Alex S. & Solomon, Barry D., 2008. "Economic valuation of environmental services sustained by water flows in the Yaqui River Delta," Ecological Economics, Elsevier, vol. 65(1), pages 155-166, March.
    12. Oerlemans, Leon A.G. & Chan, Kai-Ying & Volschenk, Jako, 2016. "Willingness to pay for green electricity: A review of the contingent valuation literature and its sources of error," Renewable and Sustainable Energy Reviews, Elsevier, vol. 66(C), pages 875-885.
    13. Suziana Hassan & Søren Bøye Olsen & Bo Jellesmark Thorsen, 2018. "Appropriate Payment Vehicles in Stated Preference Studies in Developing Economies," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 71(4), pages 1053-1075, December.
    14. Basu, Amita & Srinivasan, Narayanan, 2021. "A Modified Contingent Valuation Method Shrinks Gain-Loss Asymmetry," Journal of Behavioral and Experimental Economics (formerly The Journal of Socio-Economics), Elsevier, vol. 94(C).
    15. Damigos, D. & Tourkolias, C. & Diakoulaki, D., 2009. "Households' willingness to pay for safeguarding security of natural gas supply in electricity generation," Energy Policy, Elsevier, vol. 37(5), pages 2008-2017, May.
    16. Mvangeli Dlamini, Nqobizwe, 2015. "Households' Water Use Demand and Willingness to Pay for Improved Water Services: A Case Study of Semi-Urban Areas in the Lubombo and Lowveld Regions of Swaziland," Research Theses 243464, Collaborative Masters Program in Agricultural and Applied Economics.
    17. Lyssenko, Nikita & Martinez-Espineira, Roberto, 2009. "`Been there done that': Disentangling option value effects from user heterogeneity when valuing natural resources with a use component," MPRA Paper 21976, University Library of Munich, Germany, revised 08 Apr 2010.
    18. Tonin, Stefania, 2018. "Citizens’ perspectives on marine protected areas as a governance strategy to effectively preserve marine ecosystem services and biodiversity," Ecosystem Services, Elsevier, vol. 34(PB), pages 189-200.
    19. Drichoutis, Andreas C. & Lusk, Jayson L. & Pappa, Valentina, 2016. "Elicitation formats and the WTA/WTP gap: A study of climate neutral foods," Food Policy, Elsevier, vol. 61(C), pages 141-155.
    20. Artem Korzhenevych & Charles Kofi Owusu, 2021. "Renewable Minigrid Electrification in Off-Grid Rural Ghana: Exploring Households Willingness to Pay," Sustainability, MDPI, vol. 13(21), pages 1-17, October.

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:spr:envpol:v:19:y:2017:i:4:d:10.1007_s10018-016-0178-x. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Sonal Shukla or Springer Nature Abstracting and Indexing (email available below). General contact details of provider: http://www.springer.com .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.