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Benefits valuation of potable water quality improvement in Malaysia: the case of Kajang Municipality

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  • Jamal Othman
  • Goh Hong Lip
  • Yaghoob Jafari

Abstract

This article estimates the benefits of potable water quality improvements in Kajang Municipality in the state of Selangor, Malaysia, using the avertive cost method. Households were willing to pay MYR 322 annually to improve potable water quality. This represents about 80% of their average annual water bill. The present value of aggregate benefits over a period of 30 years at various social discount rates ranged from MYR 301 million to MYR 768 million. These estimates can be used as a reference for public investment criteria. The findings suggest that there is merit in an upward revision of water tariffs if they provide improvements in water quality.

Suggested Citation

  • 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.
    • Handle: RePEc:taf:cijwxx:v:30:y:2014:i:4:p:621-634
    DOI: 10.1080/07900627.2013.876851
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    References listed on IDEAS

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    1. Grafton, R. Quentin & Kompas, Tom & To, Hang & Ward, Michael B., 2009. "Residential Water Consumption: A Cross Country Analysis," Research Reports 94823, Australian National University, Environmental Economics Research Hub.
    2. 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.
    3. Timothy J. Bartik, 2008. "Evaluating the Benefits of Non-marginal Reductions in Pollution Using Information on Defensive Expenditures," Book chapters authored by Upjohn Institute researchers, in: Joseph Herriges & Catherine L. Kling (ed.),Revealed Preference Approaches to Environmental Valuation, volume 0, pages 459-475, W.E. Upjohn Institute for Employment Research.
    4. Lee, Cassey, 2005. "Water Tariff and Development: The Case of Malaysia," Centre on Regulation and Competition (CRC) Working papers 30676, University of Manchester, Institute for Development Policy and Management (IDPM).
    5. R. Q. Grafton (ed.), 2009. "Economics of Water Resources," Books, Edward Elgar Publishing, volume 0, number 12965.
    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. Grafton, R. Quentin & Kompas, Tom & To, Hang & Ward, Michael B., 2009. "Residential Water Consumption: A Cross Country Analysis," Research Reports 94823, Australian National University, Environmental Economics Research Hub.
    8. 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.
    9. Ngai Chan, 2012. "Managing Urban Rivers and Water Quality in Malaysia for Sustainable Water Resources," International Journal of Water Resources Development, Taylor & Francis Journals, vol. 28(2), pages 343-354.
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    Cited by:

    1. Lilia Rodríguez-Tapia & Daniel A. Revollo-Fernández & Jorge A. Morales-Novelo, 2017. "Household’s Perception of Water Quality and Willingness to Pay for Clean Water in Mexico City," Economies, MDPI, vol. 5(2), pages 1-14, April.
    2. Rajapakshe, Sisira & Termansen, Mette & Paavola, Jouni, 2022. "Valuing Water Service Improvements through Revealed Preference: Averting Behaviour Method," MPRA Paper 115623, University Library of Munich, Germany.

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