Choice experiment study on the willingness to pay to improve
AbstractModern forms of energy are an important vehicle towards poverty alleviation in rural areas of developing countries. Most developing countriesâ€™ households heavily rely on wood fuel which impact their health and socialâ€“economic status. To ease such a dependency, other modern forms of energy, namely electricity, need to be provided. However, the quality of the electricity service, namely reliability, is an important factor in reducing this dependency. This paper discusses a choice experiment valuation study conducted among electrified rural households located in Kisumu, Kenya, in which the willingness to pay (WTP) to avoid power outages or blackouts was estimated. A mixed logit estimation was applied to identify the various socio-economic and demographic characteristics which determine preferences to reduce power outages among a householdâ€™s users. In conclusion, several of the socio-economic and demographic characteristics outlined in this paper were identified and can assist service differentiation to accommodate the diverse householdsâ€™ preferences towards the improvement of the electricity service.
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Bibliographic InfoPaper provided by Universidad del País Vasco - Departamento de Economía Aplicada III (Econometría y Estadística) in its series BILTOKI with number 2009-02.
Date of creation: Jun 2009
Date of revision:
Postal: Dpto. de Econometría y Estadística, Facultad de CC. Económicas y Empresariales, Universidad del País Vasco, Avda. Lehendakari Aguirre 83, 48015 Bilbao, Spain
Find related papers by JEL classification:
- Q56 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Environment and Development; Environment and Trade; Sustainability; Environmental Accounts and Accounting; Environmental Equity; Population Growth
- C25 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Discrete Regression and Qualitative Choice Models; Discrete Regressors; Proportions
This paper has been announced in the following NEP Reports:
- NEP-ALL-2009-07-03 (All new papers)
- NEP-DCM-2009-07-03 (Discrete Choice Models)
- NEP-ENE-2009-07-03 (Energy Economics)
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