Willingness to pay and its determinants: Comparing the deposit-refund and increased-price systems among Chinese citizens for express packaging waste management

Abstract

Securing the public's willingness to pay (WTP) is pivotal to successful express packaging waste management (EPWM), and identifying the factors that influence WTP is thus an important consideration for policymakers. However, most current studies rarely distinguish WTP with respect to distinct policies and thus fail to capture the impacts of emotions and social interaction on WTP. This study therefore estimates the WTP for a deposit-refund system (DRS) and an increased-price system (IPS) and identifies its influencing factors. We use the payment card and contingent valuation methods to evaluate WTP, and then employ the Heckman two-step model to detect the effects of rational factors, emotions, and social interaction on WTP. After removing biased observations, the WTP for the DRS and IPS are ¥4.292–4.746 (∼$0.645–0.713) and ¥2.053–2.289 (∼$0.309–0.344), with 95% confidence. WTP is negatively affected by effort expectancy but positively affected by performance expectancy. Additionally, the effect of social performance expectancy on WTP is larger than those of functional and epistemic performance expectancy. Interestingly, anticipated guilt has the strongest (positive) influence on WTP for both the DRS and IPS, whereas anticipated pride is only significantly (positively) associated with WTP for the IPS. Social interaction moderates the significant effects of effort expectancy, performance expectancy, and emotions on WTP. Particularly, the moderating effect of social interaction between the association of anticipated pride with WTP is larger than that between anticipated guilt and WTP. Regarding demographics, educational attainment and family monthly income are positively associated with WTP; women's WTP is higher for the DRS, whereas men's WTP is higher for the IPS. Overall, this study addresses the understudied effects of emotions and social interaction on WTP and provides practical insights for designing EPWM policies.