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Evaluating the welfare effects of improved water quality using the choice experiment method

Author

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  • Abou-Ali, Hala

    (Department of Economics, School of Economics and Commercial Law, Göteborg University)

  • Carlsson, Fredrik

    (Department of Economics, School of Economics and Commercial Law, Göteborg University)

Abstract

This paper analyzes the welfare effects of improved health status through increased water quality using a choice experiment. The survey was administered to a random sample of households in metropolitan Cairo, Egypt. We apply a random parameter logit model in the analysis and illustrate the richness of information that can be obtained from this type of model by estimating individual level willingness to pay(WTP). We find a significant WTP for improved health status, both for short-run and long-run health effects. However, the estimated WTP is fairly low compared with the costs of a program that would achieve these improvements.

Suggested Citation

  • Abou-Ali, Hala & Carlsson, Fredrik, 2004. "Evaluating the welfare effects of improved water quality using the choice experiment method," Working Papers in Economics 131, University of Gothenburg, Department of Economics.
  • Handle: RePEc:hhs:gunwpe:0131
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    File URL: http://hdl.handle.net/2077/2786
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    References listed on IDEAS

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    1. Whittington, Dale, 1998. "Administering contingent valuation surveys in developing countries," World Development, Elsevier, vol. 26(1), pages 21-30, January.
    2. F Alpizar & F Carlsson & P Martinsson, 2003. "Using Choice Experiments for Non-Market Valuation," Economic Issues Journal Articles, Economic Issues, vol. 8(1), pages 83-110, March.
    3. Corso, Phaedra S & Hammitt, James K & Graham, John D, 2001. "Valuing Mortality-Risk Reduction: Using Visual Aids to Improve the Validity of Contingent Valuation," Journal of Risk and Uncertainty, Springer, vol. 23(2), pages 165-184, September.
    4. Herriges, Joseph A. & Kling, Catherine L., 2003. "Recreation Demand Models," Staff General Research Papers Archive 10211, Iowa State University, Department of Economics.
    5. Louviere,Jordan J. & Hensher,David A. & Swait,Joffre D., 2000. "Stated Choice Methods," Cambridge Books, Cambridge University Press, number 9780521788304, March.
    6. World Bank, 2000. "World Development Indicators 2000," World Bank Publications, The World Bank, number 13828, January.
    7. Train,Kenneth E., 2009. "Discrete Choice Methods with Simulation," Cambridge Books, Cambridge University Press, number 9780521747387, March.
    8. Whittington, Dale, et al, 1990. "Estimating the Willingness to Pay for Water Services in Developing Countries: A Case Study of the Use of Contingent Valuation Surveys in Southern Haiti," Economic Development and Cultural Change, University of Chicago Press, vol. 38(2), pages 293-311, January.
    9. Alberini, Anna & Cropper, Maureen & Fu, Tsu-Tan & Krupnick, Alan & Liu, Jin-Tan & Shaw, Daigee & Harrington, Winston, 1997. "Valuing Health Effects of Air Pollution in Developing Countries: The Case of Taiwan," Journal of Environmental Economics and Management, Elsevier, vol. 34(2), pages 107-126, October.
    10. Krinsky, Itzhak & Robb, A Leslie, 1986. "On Approximating the Statistical Properties of Elasticities," The Review of Economics and Statistics, MIT Press, vol. 68(4), pages 715-719, November.
    11. Fredrik Carlsson & Peter Martinsson, 2003. "Design techniques for stated preference methods in health economics," Health Economics, John Wiley & Sons, Ltd., vol. 12(4), pages 281-294.
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    Cited by:

    1. Deborah Ellen Lee & Stephen Gerald Hosking & Mario Du Preez, 2015. "Managing Some Motorised Recreational Boating Challenges in South African Estuaries: A Case Study at the Kromme River Estuary," South African Journal of Economics, Economic Society of South Africa, vol. 83(2), pages 286-302, June.
    2. repec:eee:ecolec:v:140:y:2017:i:c:p:157-165 is not listed on IDEAS
    3. Mullen, Jeffrey D. & Calhoun, Kayla & Colson, Gregory & Kriesel, Warren, 2015. "Effects of Uncertainty on Support for Water Quality Improvement Programs," 2015 AAEA & WAEA Joint Annual Meeting, July 26-28, San Francisco, California 205419, Agricultural and Applied Economics Association;Western Agricultural Economics Association.

    More about this item

    Keywords

    Choice experiment; Health; Water quality; Willingness to pay;

    JEL classification:

    • C25 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Discrete Regression and Qualitative Choice Models; Discrete Regressors; Proportions; Probabilities
    • I10 - Health, Education, and Welfare - - Health - - - General
    • Q25 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Renewable Resources and Conservation - - - Water

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