Dichotomous Choice Contingent Valuation Research Articles

Are retail investors willing to buy green bonds? A case for Japan

ABSTRACT With the growing importance of the financial sector in mitigating environmental pressure, many financial institutions have begun issuing green bonds. This study investigated retail investors’ willingness to pay for green bonds using the double-bounded dichotomous choice contingent valuation method. The findings from the survey performed on Japanese respondents reveal that, on average, respondents are willing to invest in green bonds when offered an annual interest rate of around 1.1%. The results also indicate that respondents with higher altruism and environmental awareness levels, information about green bonds, and frequent investors have a higher preference for investing in green bonds. The results suggest financial institutions’ importance in providing information on how green bonds can help reduce environmental pressure and raise investors’ awareness of green bonds.

Urban demand for cooking fuels in two major African cities and implications for policy

Nearly 2.3 billion people lack access to clean cooking fuels and technologies worldwide, representing a critical failure to achieve SDG7’s cooking energy access goal. In Sub-Saharan Africa, dependence on polluting cooking fuels is particularly high, resulting in considerable environmental, health, and time-related costs. Progress in the region has been greatest in urban areas, partly because incomes are higher and alternative fuels more widely available than in rural areas, but understanding of the dynamics of urban cooking energy transitions remains limited, and reasons for the divergent paths of different cities are unclear. Our primary objective is, therefore, to understand differences in the demand for several fuels among low-income households in two contrasting cities–Nairobi, where the transition is well advanced (N = 354), and Dar es Salaam, where progress has been slower (N = 1,100). We conducted a double-bounded, dichotomous choice contingent valuation experiment to elucidate how urban households would respond to changes in cooking fuels’ prices. Our analysis shows that fuel price responses vary across the income distribution and across these cities. Willingness to pay for the most commonly used cooking fuel in Nairobi–liquefied petroleum gas–is nearly twice that in Dar es Salaam, where more households prefer charcoal. In Dar es Salaam, low-income charcoal users appear especially entrenched in their cooking fuel choice. Our results have important implications for the effectiveness of different policy tools (e.g., bans, taxes, or clean fuel subsidies), since responses to pricing policies will depend on these varying price sensitivities, as well as targeting and the readiness of the supply chain (including policy enablers of supply) to meet increased demand. In conclusion, though policies are commonly designed at the national-level, policy-makers need to understand nuances in the local demand context very well when choosing instruments that best support energy transition among their most vulnerable citizens.

Estimating the Social Value of Digital Signage Landmarks as Sustainable Tourist Attractions

As urban tourism increases, digital signage landmarks are frequently utilized to develop and enhance the attractiveness of cities for tourism. However, the benefits of this development for local residents have not been fully explored from a sustainability perspective. Thus, this study aims to quantitatively analyze local residents’ perceptions of digital signage landmarks in urban areas using one of the prominent icons, the Samseong-dong free display zone in Seoul, Korea. To measure the overall value of the landmarks, this study used a double-bounded dichotomous choice contingent valuation method and spike model. Based on the surveys of 600 respondents in Korea, the results show that a household’s willingness to pay to support the landmark annually is KRW 5401 (USD 4) on average in the form of income tax. The perceived annual value for the landmark is about KRW 790 million (USD 60 million), surpassing that of typical tourism attractions in Korea.

A community group decomposition of the willingness to accept: evidence from sand, stone and gravel mining activities in Padang Pariaman, West Sumatra, Indonesia

ABSTRACT Households in the immediate vicinity of sand, stone and gravel river mining all receive negative externalities, but some of them also benefit from mining activities. Differences in the perceived effects between community groups affect their acceptance of negative externalities. This study decomposes the calculation of the mean willingness to accept (MWTA) negative externalities from river mining activities between two community groups in the Batang Anai River area in the Padang Pariaman Regency, Sumatra, Indonesia: (a) farmers and (b) individuals involved in mining activities. First, the logit model is used to determine the effect of household characteristics on the probability of the community declaring environmental degradation. Next, the dichotomous choice contingent valuation method (DC-CVM) is employed to estimate the residents’ willingness to accept (WTA) the minimum value of compensation due to negative externalities from mining activities. We utilise four scenarios to prove the presence of bias if the decomposition is not taken into account in estimating the MWTA. According to estimation results, individuals who are engaged in mining have a 21% lower MWTA value than farmers. Meanwhile, indirectly affected communities who engage in mining have a MWTA value that is 32% lower than that of farmers. The implication of this study is that the decomposition of the MWTA by community groups is important to provide the real value of negative externalities.

Establishing cost-effectiveness threshold in China: a community survey of willingness to pay for a healthy life year

IntroductionThe willingness to pay per quality-adjusted life year gained (WTP/Q) is commonly used to determine whether an intervention is cost-effective in health technology assessment. This study aimed to evaluate the...

Public willingness to pay for personal carbon trading of green travel: based on survey data from five capital cities in eastern China

Personal carbon trading is a form of pollution rights trading that is worth exploring as an innovative tool to cut back carbon emissions from travel. This paper proposes a policy scenario in which car users who exceed the average distance traveled quota are required to purchase travel credits from those who do not reach the quota and pay for them on a per hundred kilometer basis. Willingness to pay (WTP) for personal carbon trading is introduced to calculate the travel cost and its influencing factors are analyzed from the perspective of green travel. Using the double-bounded dichotomous choice contingent valuation method (DBDC), 2712 residents’ data from five provincial capital cities in eastern China is obtained. Based on this, this study first uses a binary logistic regression model to analyze the characteristics of people who are not willing to pay for green travel carbon trading, and then leverages an interval regression model to explore the willingness and intrinsic motivation of being willing to pay more or less for green travel. The results suggest that perceived usefulness is a key influencing factor of residents’ willingness to pay or pay more for green travel; Personal habits have a significant positive effect among those willing to pay; Subjective norms and moral norms can well account for the unwillingness to pay; Attitudes, perceived behavioral control, and environmental awareness fail to predict the willingness to pay among those who are unwilling to pay. In addition, WTP is also affected by demographic variables such as income and educational background. The empirical results as well indicate that the final average level of respondents’ WTP is 39.95 yuan per 100 km. The findings of this paper can provide a pricing basis while formulating personal travel carbon trading policies.

Evaluating factors influencing Tennessee and Kentucky farmers’ willingness to sell produce through fresh stop markets

IntroductionThe food justice movement focuses on resolving food system inequalities, including, but not limited to, income, ethnicity, and race differences related to household access to food, farmer access to markets, and the fair treatment of farmworkers. Previous studies have focused on food system inequalities from the consumer demand side, but only a few studies have focused on the role farmers play in creating more equitable food systems. An example of a market model aiming to fulfill various missions of the food justice movement is Fresh Stop Markets (FSMs). FSMs aggregate food from local farmers and sell shares on a sliding scale based on consumers’ income. Lower income households pay less than higher-income households for the same food. A vital component of this market concept is farmers’ willingness to sell produce through FSMs.MethodsWe used data from a 2020 survey of Tennessee and Kentucky fruit and vegetable farmers and the double-bounded dichotomous choice contingent valuation approach to assess farmers’ willingness to sell produce through FSMs when faced with a price discount scenario. A probit regression was used to investigate the factors correlated with farmers’ willingness to sell produce through FSMs.Results and discussionResults suggest gross farm revenue, farmer age, education, experience selling produce through farmers markets, and running programs on the farm to educate communities about sustainable agriculture and food systems are associated with farmers’ willingness to sell produce through FSMs.ConclusionFarmer and farm business characteristics, as well as prior experience running education programs on the farm related to sustainable agriculture and food systems are important factors to consider when trying to engage farmers willing to sell produce through FSMs.

Determinants of Smallholder Rice Farmers’ Willingness-to-Pay for Private Extension Services in Liberia: The Case of Gibi District

Globally, many policymakers and extension professionals have advocated for the privatization of extension services in order to reduce the burden of funding faced by the state as well as to adequately respond to the low productivity problem of farmers as they endeavor to tackle productivity problems. This study assessed willingness-to-pay (WTP) for private extension services by farmers and identified the determinants of their WTP using Gibi District of Liberia as a case study. A multistage sampling technique was used in selecting 296 smallholder rice farmers in the district while the double-bounded dichotomous choice contingent valuation method was used to elicit maximum WTP value for farmers. Descriptive statistics were computed and the double-bounded logit model used to analyze the data. The findings revealed that 78.7% of the rice farmers were willing to pay for privatized extension services and on average, a farmer was willing to pay US$11.21 per farm visit, almost twice the average daily wage rate of a skilled worker in Liberia. The results from the model showed that WTP was significantly positively influenced by the household head’s age, years of schooling, household size, annual income, and distance to extension service provider. The study recommends that the Liberian government and its development partners should encourage the private sector to invest more in extension services to take advantage of the relatively high farmers’ WTP and effective demand. In addition, the government should design and implement programs that reduce transaction costs in addition to increasing farmers’ income in order to enhance their capacity to pay for privatized extension services.

Determinants of agro-pastoralists’ willingness to pay for improved contagious caprine pleuropneumonia vaccine in Kenya

Animal health care is critical for livestock production especially in arid and semi-arid areas where majority are agro-pastoralists. Contagious caprine pleuropneumonia (CCPP) is a highly contagious and fatal disease which commonly affects goats in arid and semi-arid areas. The government has been the major provider of CCPP vaccine and few large-scale farmers who are licensed and able to purchase directly from the vaccine producer. Although the vaccine is sold to farmers at a subsidized price by the government, its distribution has been characterized by scarcity, irregular and late administration by the authority concerned. It is envisioned that if the willingness to pay for the CCPP vaccine among the agro-pastoralists was high, the sustainability for the vaccine availability and accessibility to everyone will be assured. This study was conducted in Kajiado and Taita Taveta counties where 323 households were sampled; thus, 276 households who were aware of the CCPP were considered for the analysis. Double-bounded dichotomous choice contingent valuation model was used to elicit agro-pastoralists’ willingness to pay for the improved CCPP vaccine with new attributes. The model revealed that off-farm income, membership to a group, previous experience on CCPP attack on goats and access to extension services positively influenced households’ willingness to pay for the improved CCPP vaccine. The results implied that provision of extension services by the government through promotion of public awareness on CCPP and on the benefit of vaccination will motivate farmers to willingly pay for vaccination services. This can be done through enhanced trainings, seminars and demonstrations to the village level, encouraging formation of groups which facilitates information sharing between agro-pastoralists as awareness and knowledge can drive the demand for the improved CCPP vaccine.

Willingness to Pay for Colorectal Cancer Screening in Vietnam: Policy Implications From a Contingent Valuation Survey

ObjectivesTo determine the willingness to pay (WTP) for the fecal occult blood test (FOBT) and colonoscopy among the general population to provide evidence for policymakers in deciding whether to include them in the social health insurance benefit package and facilitate the pricing practice. MethodsThe conventional double-bounded dichotomous choice contingent valuation survey was used to determine the WTP. We recruited 402 people aged 50 to 75 who came to 3 primary healthcare clinics in Hanoi from February 2019 to April 2019. The questionnaire was built based on the pilot research with a 5-bid design, that is, the starting bids of US $4.05, 6.75, 13.51, 21.01, and 36.47 for FOBT and US $21.01, 40.52, 54.03, 81.04, and 182.34 for colonoscopy. The data analysis was performed using the DCchoice package version 3.5.1. Cost in Vietnam dong is converted to 2022 US $using purchasing power parity method. ResultsA total of 7.2% of participants refused to pay for FOBT and colonoscopy. Analysis of the univariate model showed that the mean and median WTP for FOBT were US $62.08 and 45.28. The mean and median WTP for colonoscopy were US $101.61 and 78.61. When adjusting the WTP value by related factors, the mean and median WTP estimates for FOBT were almost the same. The choice of WTP for FOBT and colonoscopy was statistically associated with several variables. ConclusionsThis study supports the inclusion of FOBT and colonoscopy into the social health insurance benefits package. This study also supports policymakers in pricing practice to optimize the uptake rate of colorectal cancer screening tests.

Estimating Households’ Willingness-to-Pay for an Improved Solid Waste Management in Butuan City, Philippines

The concept of community participation has been a strategy of different organizations in implementing a program. A waste analysis and characterization study (WACS) was conducted in Butuan City, Philippines, before the disruption of the COVID-19 pandemic in 2020. Along with WACS is the determination of the household waste generators' willingness-to-pay (WTP) amount for improved management of solid waste in the City using the dichotomous choice contingent valuation method (DC-CVM). The study involved 427 randomly selected households who were asked how much they would pay based on the pre-identified bid prices. Respondents were iteratively asked for the WTP amount until the highest possible amount was elicited. The mean amount of WTP was estimated using the logistic regression model. The model considered the household’s socio-economic profile, solid waste generation, management practices, and perception as predictors of the WTP amount. As a result, households are willing to pay PhP19.27 every month. The model also shows that bid amount WTP, practice on segregation, awareness of collection schedule, respondent’s age, and the household’s total monthly income are significant factors affecting the willingness to pay. With the results on the suggested amount, it hopes to help the LGU Butuan Legislators and solid waste management task force formulate actions and strategies to ease the mounting problem of solid waste in the city.

Citrus growers’ willingness to pay and perceptions of cover crops

AbstractThis study develops and uses a survey to gather information on demographics, production and management practices, and perceptions on using cover crops as a conservation practice from citrus growers and utilizes the double-bounded dichotomous choice contingent valuation method to measure their willingness to pay (WTP) for adopting cover crops in citrus production. The survey is conducted for citrus producers in Florida and Texas. The study finds that, on average, growers from Florida are willing to pay $509.48/acre per year for adopting cover crops. This is substantially less than the WTP for growers in Texas, who are willing to pay more than $1,000/acre per year for cover crops. The study analyzes the factors that have significant impacts on growers’ WTP for cover crops and discusses the heterogeneity in the grower perceptions on the benefits and drawbacks of using this conservation practice by state. Although using cover crops has not been a popular conservation practice in perennial fruit production systems, its potential to improve soil quality is particularly important for citrus production in Florida where soils are sandy and have low organic matter.

Willingness to Pay for Renewably-Sourced Home Heating in the Fairbanks North Star Borough

Space heating is a necessity in Alaska; however, the use of heating fuels carries both economic and environmental costs. In the Fairbanks North Star Borough (FNSB), Alaska, most households utilize heating fuel oil as a primary source for home heating and firewood as a secondary source. In the FNSB, wood-burning devices are the principal source of fine particulate matter with a size of 2.5 microns or less, (PM2.5), but firewood is less expensive when compared to heating fuel oil. The FNSB has been designated as a nonattainment area for PM2.5, which has been linked to negative cardiopulmonary impacts and other adverse health consequences. Electric thermal storage heaters (ETSH) could help solve the PM2.5 problem by displacing firewood used for residential space heating. We use dichotomous choice contingent valuation (DC-CV) to estimate willingness to pay (WTP) for an ETSH program which would allow FNSB residents to offset 100 gallons of heating fuel oil annually. Certainty correction is used to control for the presence of hypothetical bias. We find median WTP is USD 33.98 without certainty correction and USD 9.75 with certainty correction. Our results indicate that implementation of a special ETSH electricity rate based on the WTP estimate may lead to broader adoption of ETSH for space heating, which could improve air quality, reduce fuel poverty, and reduce the carbon footprint of residential space heating.

Investigating Factors Affecting Institutional Investors’ Green Bond Investments: Cases for Beijing and Shenzhen

We conducted a survey of institutional investors in Beijing and Shenzhen to analyze the factors affecting green bond (GB) investing in China, such as credit rating, GB issuer, fund use, liquidity, redemption term, certification label, and type of currency. We then compared the results for Beijing and Shenzhen, including factors that affected greenium and the two cities’ willingness to pay (WTP). Using a double-bounded dichotomous choice contingent valuation method, we find that higher credit ratings tend to increase Beijing investors’ WTP and that the use of GB proceeds affects Shenzhen investors’ WTP. We also find that investors place importance on the type of currency, length of redemption term, and liquidity when investing in GB, while the certification label does not have an impact on WTP. The WTP for GB was higher among Shenzhen investors than among Beijing investors. These findings provide important insights for the government and financial institutions to take the right action to expand the GB market and to establish a GB framework that induces the financial sector toward reducing greenhouse gas emissions.

Hometown effect on consumer preferences for food products

This study examines how consumers’ hometown orientation affects their preferences for food products. Regarding food products, consumers may prefer products from their hometown over those produced in other domestic areas, among other factors. We consider that due to population migration, a consumers’ current or local place of residence may not necessarily be their hometown. After defining the hometown effect with a framework of consumer willingness to pay, we apply a double-bounded dichotomous choice contingent valuation method to value the hometown effect on a rice product, based on a consumer survey conducted in Japan. This study reveals that consumers’ hometown orientation significantly affects their preferences for the rice product produced in their hometown. The magnitude of the hometown effect for the product is estimated at 48 JPY (0.44 USD) per kg in terms of consumer willingness to pay. The premium rate of the hometown effect compared with the price of the base product is 12.4%. Food labels indicating more detailed region of origin information could be a potential marketing strategy to appeal to consumers from that region but currently living in other areas.

Public Willingness to Pay for Green Lifestyle in China: A Contingent Valuation Method Based on Integrated Model.

The purpose of this study was to note how people recognize the green lifestyle and how much extra money they are willing to pay for it. An integrated model based on the theory of planned behavior was constructed, and data on the willingness to pay (WTP) for green lifestyles of 1377 respondents in five cities in East China were measured and calculated using the double-bounded dichotomous choice contingent valuation method (DBDC) combined with interval regression analysis. The results showed that the respondents were willing to pay an extra 81.8 yuan, 52.5 yuan, 38.9 yuan, 53.2 yuan, and 37.2 yuan per month for green food, clothing, travel, housing, and waste recycling, respectively. Attitude and moral norms were the strongest predictors of WTP for green clothing, travel, housing, and waste recycling. Perceived behavior control, environmental awareness, personal habits, subjective knowledge, gender, income, and education can affect a few kinds of green lifestyle's WTP.

International Tourists' Willingness to Pay for A Wildlife Conservation Program: A Case Study of Northern Yellow-cheeked Gibbons in Bach Ma National Park, Vietnam

Extending protected areas has enabled global species and habitat protection, especially for endangered species. In addition, understanding social preferences for species protection is essential to contribute to the biodiversity conservation efforts of protected areas. The main purpose of the study was to investigate the preferences of international tourists towards the protection of the northern yellow-cheeked gibbon (Nomascus annamensis) through a proposed wildlife conservation program in Bach Ma National Park, Central Vietnam. Data for the study was collected from a face-to-face survey of 361 randomly selected foreign tourists visiting Bach Ma National Park. By using the dichotomous choice contingent valuation approach, we estimate international tourists' willingness to pay (WTP) for the proposed conservation program of gibbons and identify elements that influence their WTP for the conservation program. We found that international tourists strongly support conserving gibbon populations in the Bach Ma. The findings from the logistic regression model in the study reveal that the respondents' bid level, education, knowledge, biodiversity conservation, climate change, and revisit variables were all significantly predictive of WTP. The estimated mean WTP amount for one-time funding of the species conservation program was US$7.83 per international tourist. The obtained results of this study suggest that policy-makers and managers of national parks should consider the significance of international visitors' support for gibbon conservation efforts when designing and developing their social strategies, programs, and policies for protecting nature and preserving biodiversity, particularly with regard to tourism segmentation in protected areas.

Consumers’ willingness to pay for quail products in Tamale metropolis, Ghana

This study examines consumers' willingness to pay higher price premiums for quail products using the price of chicken as a benchmark. A double-bounded dichotomous choice contingent valuation was used to elicit the data, and the factors influencing consumers’ Willingness to Pay (WTP) were identified using the ordered logit regression model. Results revealed that on the average consumers were willing to pay a higher price premium for quail products, with the mean WTP of GH¢ 27.46 ($5.66), representing 196.14% price premium and GH¢26.34 ($5.43) representing 196.03% price premium per crate of eggs and 1 kg of quail meat, respectively. These findings are crucial for the development of the products as well as formulating marketing strategies for its promotion in the African food markets. • Quail products are very nutritious. • Consumers awareness on quail products influences their willingness to pay higher premium. • Consumers that are educated are willing to pay higher premium for quail products. • Promotion of quail products could help in efforts towards food and nutrition security.

Institutional Investors’ Willingness to Pay for Green Bonds: A Case for Shanghai

The issuance of green bonds has been increasing since 2016 in China, and the number of papers covering the topic is growing. In previous studies on greenium, not much has been investigated from the institutional investors’ perspective. The study estimates the institutional investors’ level of greenium by surveying the institutional investors in Shanghai, China, from October 23 to 1 November 2021, using the double-bound dichotomous choice (DBDC) contingent valuation method (CVM). The study also analyzes the effects of variables that are known to be important for the green bond based on previous studies. The study identifies that there is a greenium level of 0.47%. Among the seven variables tested with logit regression models, the credit and currency of the bond had a positive effect on the greenium. The study provides helpful insights for issuers’ strategic planning and could be a stepping stone to increasing issuance not only for the Chinese green bond market but also for the global green bond market.

Will the public in emerging economies support renewable energy? Evidence from Ho Chi Minh City, Vietnam

Public acceptance and support are crucial to increasing the adoption of renewable energy technologies and establishing new renewable energy policies. In Vietnam, where plans to rapidly scale-up electricity generation are among the fastest globally, one question of interest is what would motivate people to pay more for electricity generated by renewable energy sources? As part of its national Power Development Plan, Vietnam targets a future electricity mix consisting of at least 21% renewable energy by 2030. This study assesses the public's willingness to pay (WTP) for increasing renewable energy share and corresponding motivating factors in Ho Chi Minh City, Vietnam. Drawing from a valid sample of 294 households, this study uses a double-bounded dichotomous choice contingent valuation method (CVM) to evaluate the public perception of renewable energy. On average, respondents are willing to pay about $4.39 USD more on their monthly electric bill to support renewable energy, which represents a 9.48% increase. Notably, respondents most concerned with air quality and the utility's profitability indicated their support to pay more for renewable energy. This study suggests the importance of communicating health-related air pollution mitigation benefits for emerging economies and building support among customers so that electric utilities can increase renewable energy targets. From a policy perspective, improved and transparent disclosure of air pollution data and utility financial statements could expedite the transition to renewable energy in emerging economies, such as Vietnam.