Willingness to pay for the environment : the role of social status and of prosocial orientation

Based on an international survey, this paper examines how individual characteristics influence willingness to pay for environmental protection. We interpret willingness to pay as a relevant component of climate policy acceptability, especially when policies impose direct costs on individuals. We contribute to the literature by showing the positive impact of social status (how respondents place themselves on the social scale) and of prosocial orientation (whether respondents act for the environment independently of others). Both remain significant after controlling for other factors identified in the literature, notably income and education. Our results suggest that two types of communication may strengthen individuals' willingness to pay for the environment: (1) campaigns aimed at influencing subjective social status, potentially through determinants identified in the literature; and (2) campaigns aimed at shaping prosocial orientation, that is, convincing individuals that personal actions are meaningful even when others do not act. In addition, we show that acceptability of climate policies is more likely when they impose net costs on individuals who rank themselves in the top 40% of the population (social status), and on the 50% of individuals who are willing to act independently of others (prosocial orientation). By contrast, policies that impose net costs on individuals with lower subjective social status or on the less prosocial half of the population are more likely to face opposition. Furthermore, social status (especially when low) and income are more important in lower-income countries, whereas in higher-income countries, prosocial orientation prevails and income loses importance.