The Value Of Improved Water Quality To Chesapeake Bay Boaters
As part of an economic survey of Maryland registered boat owners, an open ended contingent valuation question was posed regarding willingness to pay for an improvement in water quality in Chesapeake Bay. The boaters ranked their perception of water quality on a scale of one to five, and the payment was for an improvement of one unit. Boaters also indicated the type of concern poor water quality raised, ranging from no concern to concern about long term effects of exposure to toxic chemicals. Median willingness to pay for a one step improvement in water quality was $17.50 per year and the mean was $63, with 38% expressing a zero willingness-to-pay. A tobit model was estimated to determine what factors influenced willingness to pay amounts. Sailboaters and boats that were kept in the water rather than trailered were willing to pay more for water quality improvements. Additionally, the lower the individual ranked water quality and the greater concern for the health effects from water quality, the more the willingness to pay for a water quality improvement. In aggregate, Chesapeake Bay boaters in Maryland were willing to pay approximately $7.3 million per year to achieve the stated water quality improvement. The present value of this improvement, at a 5% discount rate is a $146 million.
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- Mark L. Messonnier & John C. Bergstrom & Christopher M. Cornwell & R. Jeff Teasley & H. Ken Cordell, 2000. "Survey Response-Related Biases in Contingent Valuation: Concepts, Remedies, and Empirical Application to Valuing Aquatic Plant Management," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 82(2), pages 438-450.