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This paper provides further empirical evidence of payment uncertainty in dichotomous choice contingent valuation (CV) and proposes an alternative way of certainty calibration, moving away from conventional recoding of uncertain responses. In an international CV application, the main sources of payment uncertainty are identified related to imperfect knowledge and information about the public environmental good involved, future supply levels, income constraints, price levels and the survey instrument. Together these sources of uncertainty are responsible for a third of the error variance in the estimated discrete choice model. Accounting for the heterogeneity induced by payment uncertainty in the welfare estimation procedure with the help of a mixed probit model yields a significantly lower welfare measure albeit at the expense of estimation precision.

AbstractA comprehensive review of experiences with water quality trading (WQT) programs worldwide is presented, spanning altogether more than 4 decades. A new WQT database is built, extracting data and information from existing review papers, complemented with gray and published literature about individual trading programs. Key aspects that affect trading volumes and program continuation are identified and categorized. No single success or fail factor emerges from this review, typically a mix of factors play a role. There is potential for WQT to evolve further and serve as a cost‐effective pollution control instrument, but this requires nudging political will to regulate nonpoint source.

AbstractA discrete choice experiment, aiming to elicit public preferences for improvements in solid waste services, is carefully administered across socioeconomic zones in the city of Hawassa, Ethiopia. Observed and unobserved preference heterogeneity are analyzed using mixed logit choice models. The results show that there exists substantial willingness to pay to increase collection frequency and separate recyclable waste. A new issue is the focus on child labor in the waste management sector. Significant gender effects are found: women are more interested than men in increasing waste collection frequency and value the abolishment of child labor more highly, as do higher income households. As expected, respondents living in wealthier neighborhoods are more likely to pay higher service charges. Education indirectly influences preferences for waste separation. The study provides important insight into the social benefits of public investment decisions to improve the quality of solid waste management services in large cities in Ethiopia.

AbstractIn this study we model the preferences and willingness to pay (WTP) of downstream farmers in one of the largest irrigation schemes worldwide in Sudan for improved irrigation water supply through transboundary collaboration with farmers upstream in Ethiopia. In a choice experiment, Sudanese farmers are asked to pay an increase in existing irrigation fees to secure future irrigation water availability by either enhancing the removal of sediments in their local irrigation channels or compensating farmers in the Ethiopian highlands for taking soil conservation measures to prevent land degradation and soil erosion. Although Sudanese farmers downstream do not feel very connected to farmers upstream in Ethiopia, we find a high degree of trust in international cooperation and a positive WTP for improved irrigation water supply and water use efficiency through transboundary collaboration.

Switzerland plans to restore 4000 km of rivers by 2090. Despite the immense investment costs, river restoration benefits have not been valued in monetary terms, and a cost-benefit analysis (CBA) does not exist for any river restoration project in Switzerland. We apply stated preference methods to elicit public preferences and willingness to pay for restoring two specific but representative river sites. The benefits of restoration are compared with its costs. Upscaling the results to the national level shows that the government budget allocated for river restoration (CHF 1200/m) is insufficient to cover the costs of local restoration projects. However, the surveyed local populations are willing to pay substantially more for restoring rivers in their area of residence than they are legally obliged to do. The CBA results demonstrate that the benefits outweigh the costs in the two case studies, and hence that restoration efforts are justified from an economic point of view. A sensitivity analysis shows that the main results and conclusions do not change when we change some of the key assumptions underlying the CBA.

AbstractThe 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 per cent 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 more promise since it is easier to understand and imposes less cognitive burden on survey participants than the SPC in a developing country context.