Comparing welfare estimates across stated preference and uncertainty elicitation formats for air quality improvements in Nairobi, Kenya

Abstract

The effect of preference uncertainty on estimated willingness to pay (WTP) is examined using identical payment cards and alternative uncertainty elicitation procedures in three split samples, focusing on air quality improvement in Nairobi. The effect of the stochastic payment card (SPC) and polychotomous payment card (PPC) are compared with a conventional payment card (PC). Substantial financial support is found for improved air quality in Nairobi, with approximately 85 percent of the whole sample stating a positive WTP. The way WTP values are elicited, with and without ability to express preference uncertainty, has significant effect on WTP welfare estimate. Allowing respondents to express experienced uncertainty when stating WTP value yields more conservative, but less accurate WTP values for inclusion in policy analysis. The PPC seems to hold most promise since it is easier to understand and imposes less cognitive burden on survey participants than the SPC in a developing country context.

The Valuation of Grassland Ecosystem Services in Inner Mongolia of China and Its Spatial Differences

“…In the second part of the model, since respondents' bids in the payment card format are not continuous but discrete intervals, we employed the interval regression model to estimate the amount of WTP conditional on the requirement that the WTP must be positive [35]. Let the vector v = (v 1 , v 2 , · · · , v j ) represent the values on the payment card, arranged in ascending order, and let v i represent the value chosen by the ith respondent.…”

“… 35. Protecting the grassland ecosystem can ensure the existence of the grassland in Inner Mongolia.14.47 Protecting grassland is very important for the production and life in Inner Mongolia 13.42 Protecting the grassland ecosystem can provide us with option values.…”