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Willingness to pay for environmental goods in Norway: A contingent valuation study with real payment

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Author Info
Kalle Seip
Jon Strand
Abstract

The study seeks to determine the maximum willingness to pay (MWTP) among a random sample of Norwegians, for membership in the largest environmentalist association in Norway, Norges Naturvernforbund (NNV). The study includes three stages: (1) a contingent valuation study, testing hypothetical MWTP; (2) those whose stated MWTP is at or above the current membership fee are then asked to pay this fee; (3) those individuals who do not pay in stage 2 are interviewed, and asked to consider revising their MWTP statement. The study is seemingly the first of its kind in comparing hypothetical and actual MWTP by typing valuation of a public good (the environment) to the value of a private good (membership of the NNV). The results show a rather poor correspondence between hypothetical and actual MWTP, since only 6 out of 64 who stated that they were willing to pay the membership fee in stage 1, actually paid this voluntarily in stage 2. Possible reasons for this discrepancy are discussed, on the basis of data from the telephone interview in stage 3, and on information gathered in stage 1. The data indicate that a substantial part of this discrepancy is due to MWTP being overstated in stage 1, but that other reasons also are important. Copyright Kluwer Academic Publishers 1992

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Article provided by European Association of Environmental and Resource Economists in its journal Environmental and Resource Economics.

Volume (Year): 2 (1992)
Issue (Month): 1 (January)
Pages: 91-106
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Handle: RePEc:kap:enreec:v:2:y:1992:i:1:p:91-106

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Keywords: Contingent valuation; environmental goods; willingness to pay;

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  1. Bohm, Peter, 1972. "Estimating demand for public goods: An experiment," European Economic Review, Elsevier, vol. 3(2), pages 111-130. [Downloadable!] (restricted)
  2. Carson, Richard T. & Hanemann, W. Michael, 2006. "Contingent Valuation," Handbook of Environmental Economics, in: K. G. Mäler & J. R. Vincent (ed.), Handbook of Environmental Economics, edition 1, volume 2, chapter 17, pages 821-936 Elsevier. [Downloadable!] (restricted)
  3. Hoehn, John P & Randall, Alan, 1989. "Too Many Proposals Pass the Benefit Cost Test," American Economic Review, American Economic Association, vol. 79(3), pages 544-51, June. [Downloadable!] (restricted)
  4. Kealy, Mary Jo & Montgomery, Mark & Dovidio, John F., 1990. "Reliability and predictive validity of contingent values: Does the nature of the good matter?," Journal of Environmental Economics and Management, Elsevier, vol. 19(3), pages 244-263, November. [Downloadable!] (restricted)
  5. Rowe, Robert D. & D'Arge, Ralph C. & Brookshire, David S., 1980. "An experiment on the economic value of visibility," Journal of Environmental Economics and Management, Elsevier, vol. 7(1), pages 1-19, March. [Downloadable!] (restricted)
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  2. Hans Asbjørn Aaheim & Kristin A. & Hans Seip, 1999. "Climate Change and Local Pollution Effects – An Integrated Approach," Mitigation and Adaptation Strategies for Global Change, Springer, vol. 4(1), pages 61-81, March. [Downloadable!] (restricted)
  3. Felix Schlapfer & Anna Roschewitz & Nick Hanley, . "Contingent valuation and real referendum behaviour," Working Papers 2001_8, Department of Economics, University of Glasgow. [Downloadable!]
  4. John List & Craig Gallet, 2001. "What Experimental Protocol Influence Disparities Between Actual and Hypothetical Stated Values?," Environmental & Resource Economics, European Association of Environmental and Resource Economists, vol. 20(3), pages 241-254, November. [Downloadable!] (restricted)
  5. Douglas Macmillan & Trevor Smart & Andrew Thorburn, 1999. "A Field Experiment Involving Cash and Hypothetical Charitable Donations," Environmental & Resource Economics, European Association of Environmental and Resource Economists, vol. 14(3), pages 399-412, October. [Downloadable!] (restricted)
  6. Richard O‘Conor & Magnus Johannesson & Per-Olov Johansson, 1999. "Stated Preferences, Real Behaviour and Anchoring: Some Empirical Evidence," Environmental & Resource Economics, European Association of Environmental and Resource Economists, vol. 13(2), pages 235-248, March. [Downloadable!] (restricted)
  7. Gregory Poe & Jeremy Clark & Daniel Rondeau & William Schulze, 2002. "Provision Point Mechanisms and Field Validity Tests of Contingent Valuation," Environmental & Resource Economics, European Association of Environmental and Resource Economists, vol. 23(1), pages 105-131, September. [Downloadable!] (restricted)
  8. John A. List & J. Shogren, 1998. "Calibration of the difference between actual and hypothetical valuations in a field experiment," Framed Field Experiments 0038, The Field Experiments Website. [Downloadable!]
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  9. John A. List & Jay Shogren, 2002. "Calibration of Willingness-to-Accept," Framed Field Experiments 0054, The Field Experiments Website. [Downloadable!]
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  10. Franz Hackl & Gerald Pruckner, 1997. "Towards More Efficient Compensation Programmes for Tourists' Benefits From Agriculture in Europe," Environmental & Resource Economics, European Association of Environmental and Resource Economists, vol. 10(2), pages 189-205, September. [Downloadable!] (restricted)
  11. Nick Hanley & Felix Schlapfer, . "Calibration of Stated Willingness to Pay for Public Goods with Voting and Tax Liability Data: Provision of Landscape Amenities in Switzerland," Working Papers 2002_2, Department of Economics, University of Glasgow. [Downloadable!]
  12. Eline Aas, 2009. "Pecuniary compensation increases participation in screening for colorectal cancer," Health Economics, John Wiley & Sons, Ltd., vol. 18(3), pages 337-354. [Downloadable!]
  13. Ethier, Robert & Poe, Gregory & Schulze, William & Clark, Jeremy, 1997. "A Comparison Of Hypothetical Phone And Mail Contingent Valuation Responses For Green Pricing Electricity Programs," Working Papers 7245, Cornell University, Department of Applied Economics and Management. [Downloadable!]
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  14. Patricia Champ & Richard Bishop, 2001. "Donation Payment Mechanisms and Contingent Valuation: An Empirical Study of Hypothetical Bias," Environmental & Resource Economics, European Association of Environmental and Resource Economists, vol. 19(4), pages 383-402, August. [Downloadable!] (restricted)
  15. M. R. Bhatia & J. A. Fox-Rushby, 2003. "Validity of Willingness to Pay: hypothetical versus actual payment," Applied Economics Letters, Taylor and Francis Journals, vol. 10(12), pages 737-740, October. [Downloadable!] (restricted)
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