Analysis of the Relationship between Risk Perception and Willingness to Pay for Nuclear Power Plant Risk Reduction

Abstract

With the adoption of new technologies, more risk is introduced into modern society. Important decisions about new technologies tend to be made by specialists, which can lead to a mismatch of risk perception between citizens and specialists, resulting in high social cost. Using contingent valuation methods, this paper analyzes the relationship between willingness to pay (WTP) and the factors expressed through people’s image of nuclear power plants (NPP), their perception of NPP safety, and how these can be affected by their scientific background level. Results indicate that groups with a high scientific background level tend to have low risk perception level, represented through their image and safety levels. Further, the results show that mean WTP is dependent on scientific background and image levels. It is believed that these results could help decision makers address the mismatch of trust between the public and specialists in terms of new policy.

How to value safety in economic evaluations in health care? A review of applications in different sectors

“…Dichotomous choice questions can be broken down into single- or double-bounded questions, where a double-bounded question means that, after being given an initial ‘yes or no’ WTP price, as in a single-bounded question, the respondent is then given a second WTP option dependent on his first answer [32]. The most popular question format of the 22 papers is an open-ended question (48%) [11, 15, 16, 19, 27, 29, 30, 33, 47], followed by dichotomous choice [1, 15, 17, 26, 40, 47, 54, 55] (35%), and payment card [33–37]. Two of the papers use both open-ended questions and dichotomous choice [15, 47].…”

“…These covariates can be categorised into three groups: individual characteristics, individual relationship with risk, and aspects of the study design. Regarding individual characteristics, the findings show that higher income was associated with a higher WTP in every case in which it was investigated [2, 3, 12, 27–31, 33, 36, 40, 45, 47, 55]. Many papers investigating this relationship (70%) report that having a higher level of education is associated with a higher WTP [1, 11, 27, 31, 45, 47], while others (30%) report the opposite result [28, 33, 55].…”

“…Age and gender are variables for which ambiguous effects were reported. Several papers (54%) find that increasing age is associated with increased WTP [1, 28, 29, 45, 54], however, others (46%) report the opposite result [2, 11, 31, 33, 55]. In papers where gender was considered sometimes men reported a higher WTP [11, 45] and sometimes women did [12, 29, 33].…”

“…Two studies also investigated the effects of more information on individuals’ WTP. Chanel et al [15] found that giving more information regarding pollution levels is associated with higher WTP, whereas Yun et al [55] found that providing people with better quality informational images is associated with lower WTP for reduced nuclear power plant hazard. Because they approach the study from the point of view that nuclear power plants are safer than assumed by some of the public, they do not explicitly discuss why better quality information is associated with lower WTP [55], however, in general better information should have no a priori effect: it simply depends on whether prior expectations were too high or too low.…”

Financial Feasibility and Social Acceptance for Reducing Nuclear Power Plants: A Contingent Valuation Study

“…Yun et al [25] investigated whether people's image of an NPP, their perception of safety, and scientific background related to their WTP for reducing risk in a nuclear power plant. Results showed that the mean WTP for all the respondents was about USD 17.014/month.…”