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Understanding Willingness to Support Higher Taxes for Urban Transportation Services: The Case of an American City

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  • Jean-Claude Thill

    ()

  • Chunhua Wang

Abstract

This paper examines how a respondent’s socioeconomic characteristics influence her willingness to support tax increases for spending on highway transportation infrastructure and four modes of public transportation (i.e., bus, light rail, commuter rail, and streetcar) in a fast growing urban area in the United States. We use and analyze detailed survey data at household level collected from a phone interview survey conducted in the Charlotte, North Carolina, area. We consider two types of response bias in the survey data. One is a systematic response bias which arises from protest zeros and respondents’ tendency to under-report their willingness. The other is from the randomized response when a respondent answers survey questions by guessing because she does not have memory or knowledge of the questions and choices. Along with random utility model, these two response bias models are estimated and compared to each other. Empirical results show that an individual’s attitudes towards paying higher taxes are affected by the individual’s location, home ownership, and the level of educational attainment. It is found that respondents tend to grossly under-report their willingness to support higher taxes for investments on highways, bus, and commuter rail in the survey. Respondents also exhibit positive tendency to choose no increase in taxes in the survey about highway, bus, and commuter rail, although they actually prefer an increase over no increase. They have positive chance of randomly choosing slightly higher taxes for more investment on streetcar whatever her true preference is. We discuss policy implications of the empirical results.

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File URL: http://www-sre.wu.ac.at/ersa/ersaconfs/ersa11/e110830aFinal01449.pdf
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Bibliographic Info

Paper provided by European Regional Science Association in its series ERSA conference papers with number ersa11p1449.

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Date of creation: Sep 2011
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Handle: RePEc:wiw:wiwrsa:ersa11p1449

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  1. Jorgensen, Bradley S. & Syme, Geoffrey J., 2000. "Protest responses and willingness to pay: attitude toward paying for stormwater pollution abatement," Ecological Economics, Elsevier, vol. 33(2), pages 251-265, May.
  2. Werner, Megan, 1999. "Allowing for Zeros in Dichotomous-Choice Contingent-Valuation Models," Journal of Business & Economic Statistics, American Statistical Association, vol. 17(4), pages 479-86, October.
  3. Elisabetta Strazzera & Riccardo Scarpa & Pinuccia Calia & Guy Garrod & Kenneth Willis, 2003. "Modelling zero values and protest responses in contingent valuation surveys," Applied Economics, Taylor & Francis Journals, vol. 35(2), pages 133-138.
  4. Meyerhoff, Jurgen & Liebe, Ulf, 2006. "Protest beliefs in contingent valuation: Explaining their motivation," Ecological Economics, Elsevier, vol. 57(4), pages 583-594, June.
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