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Estimating Willingness to Pay for Improved Drinking Water Quality Using Averting Behavior Method with Perception Measure


  • Mi-Jung Um
  • Seung-Jun Kwak
  • Tai-Yoo Kim


This paper suggests an application of an averting behaviormethod to reconcile inconsistent public activity with objectiveenvironmental risk. In Korea, an historically polluted watersupply has created citizen resistance to using tap water. Koreansperceive low quality levels for tap water, although objectivelymeasured data show that the pollution levels are lower than theacceptable risk. We hypothesized that the irrational aversion tousing tap water is a consequence of inconsistencies between theobjectively measured and perceived pollution levels. We introducethe perception averting behavior method, in which we add aperception measure unit to the conventional averting behaviormethod. We found that the perception measure provided a validexplanation for citizens' aversion to using tap water in Korea. Copyright Kluwer Academic Publishers 2002

Suggested Citation

  • Mi-Jung Um & Seung-Jun Kwak & Tai-Yoo Kim, 2002. "Estimating Willingness to Pay for Improved Drinking Water Quality Using Averting Behavior Method with Perception Measure," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 21(3), pages 285-300, March.
  • Handle: RePEc:kap:enreec:v:21:y:2002:i:3:p:285-300
    DOI: 10.1023/A:1014537330423

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    References listed on IDEAS

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    3. Harrington, Winston & Krupnick, Alan J. & Spofford, Walter Jr., 1989. "The economic losses of a waterborne disease outbreak," Journal of Urban Economics, Elsevier, vol. 25(1), pages 116-137, January.
    4. Tversky, Amos & Slovic, Paul & Kahneman, Daniel, 1990. "The Causes of Preference Reversal," American Economic Review, American Economic Association, vol. 80(1), pages 204-217, March.
    5. Andrew S. Laughland & Wesley N. Musser & James S. Shortle & Lynn M. Musser, 1996. "Construct Validity of Averting Cost Measures of Environmental Benefits," Land Economics, University of Wisconsin Press, vol. 72(1), pages 100-112.
    6. Charles W. Abdalla & Brian A. Roach & Donald J. Epp, 1992. "Valuing Environmental Quality Changes Using Averting Expenditures: An Application to Groundwater Contamination," Land Economics, University of Wisconsin Press, vol. 68(2), pages 163-169.
    7. Grether, David M & Plott, Charles R, 1979. "Economic Theory of Choice and the Preference Reversal Phenomenon," American Economic Review, American Economic Association, vol. 69(4), pages 623-638, September.
    8. Arrow, Kenneth J, 1982. "Risk Perception in Psychology and Economics," Economic Inquiry, Western Economic Association International, vol. 20(1), pages 1-9, January.
    9. Courant, Paul N. & Porter, Richard C., 1981. "Averting expenditure and the cost of pollution," Journal of Environmental Economics and Management, Elsevier, vol. 8(4), pages 321-329, December.
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    Cited by:

    1. Lanz, Bruno & Provins, Allan, 2017. "Using averting expenditures to estimate the demand for public goods: Combining objective and perceived quality," Resource and Energy Economics, Elsevier, vol. 47(C), pages 20-35.
    2. Olivier Beaumais & Anne Briand & Katrin Millock & Céline Nauges, 2010. "What are Households Willing to Pay for Better Tap Water Quality ? A Cross-Country Valuation Study," Université Paris1 Panthéon-Sorbonne (Post-Print and Working Papers) halshs-00497453, HAL.
    3. Noor, Junaid & Siddiqi, Wasif & Muhammad, Taj, 2010. "Estimation of Willingness to Pay for Improvements in Drinking Water Quality in Lahore: A Case Study of WASA, Lahore," MPRA Paper 53763, University Library of Munich, Germany.
    4. Henrique Monteiro, 2010. "Residential Water Demand in Portugal: checking for efficiency-based justifications for increasing block tariffs," Working Papers Series 1 ercwp0110, ISCTE-IUL, Business Research Unit (BRU-IUL).
    5. Jessoe, Katrina, 2013. "Improved source, improved quality? Demand for drinking water quality in rural India," Journal of Environmental Economics and Management, Elsevier, vol. 66(3), pages 460-475.
    6. Zhang, Fan & Fogarty, James, 2015. "Nonmarket Valuation of Water Sensitive Cities: Current Knowledge and Issues," Working Papers 207694, University of Western Australia, School of Agricultural and Resource Economics.
    7. Kevin Boyle & Sapna Kaul & Ali Hashemi & Xiaoshu Li, 2015. "Applicability of benefit transfers for evaluation of homeland security counterterrorism measures," Chapters,in: Benefit–Cost Analyses for Security Policies, chapter 10, pages 225-253 Edward Elgar Publishing.
    8. repec:gii:giihei:ciesrp:cies_rp_27 is not listed on IDEAS
    9. Bruno Lanz & Allan Provins, 2014. "The demand for tap water quality: Survey evidence on water hardness and aesthetic quality," CIES Research Paper series 23-2014, Centre for International Environmental Studies, The Graduate Institute.
    10. John C. Whitehead, 2006. "Improving Willingness to Pay Estimates for Quality Improvements through Joint Estimation with Quality Perceptions," Southern Economic Journal, Southern Economic Association, vol. 73(1), pages 100-111, July.
    11. Armand, Totouom Fotue Luc, 2016. "Determinants of household avoidance behavior to cope with unsafe drinking water: case study of Cameroon," 2016 AAAE Fifth International Conference, September 23-26, 2016, Addis Ababa, Ethiopia 249333, African Association of Agricultural Economists (AAAE).
    12. Jason F. Shogren & Tommy Stamland, 2005. "Self-Protection and Value of Statistical Life Estimation," Land Economics, University of Wisconsin Press, vol. 81(1).
    13. Irina Klytchnikova & Michael Lokshin, 2009. "Measuring Welfare Gains from Better Quality Infrastructure," Journal of Infrastructure Development, India Development Foundation, vol. 1(2), pages 87-109, December.
    14. Melo, Grace, 2016. "Valuing Groundwater Quality: Does Averting Behavior Matter?," 2016 Annual Meeting, February 6-9, 2016, San Antonio, Texas 230001, Southern Agricultural Economics Association.
    15. Richardson, Leslie A. & Champ, Patricia A. & Loomis, John B., 2012. "The hidden cost of wildfires: Economic valuation of health effects of wildfire smoke exposure in Southern California," Journal of Forest Economics, Elsevier, vol. 18(1), pages 14-35.
    16. Leslie Richardson & John B. Loomis & Patricia A. Champ, 2013. "Valuing Morbidity from Wildfire Smoke Exposure: A Comparison of Revealed and Stated Preference Techniques," Land Economics, University of Wisconsin Press, vol. 89(1), pages 76-100.
    17. Jamal Othman & Goh Hong Lip & Yaghoob Jafari, 2014. "Benefits valuation of potable water quality improvement in Malaysia: the case of Kajang Municipality," International Journal of Water Resources Development, Taylor & Francis Journals, vol. 30(4), pages 621-634, December.
    18. repec:gii:ciesrp:cies_rp_36rev is not listed on IDEAS


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