Watershed management benefits in a hypothetical, real intention and real willingness to pay approach

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Lehtoranta , V , Kosenius , A-K & Seppälä , E 2017 , ' Watershed management benefits in a hypothetical, real intention and real willingness to pay approach ' , Water Resources Management , vol. 31 , no. 13 , pp. 4117-4132 . https://doi.org/10.1007/s11269-017-1733-3

Title: Watershed management benefits in a hypothetical, real intention and real willingness to pay approach
Author: Lehtoranta, Virpi; Kosenius, Anna-Kaisa; Seppälä, Elina
Contributor organization: University of Helsinki
Department of Economics and Management
Environmental and Resource Economics
Date: 2017-10
Language: eng
Number of pages: 16
Belongs to series: Water Resources Management
ISSN: 0920-4741
DOI: https://doi.org/10.1007/s11269-017-1733-3
URI: http://hdl.handle.net/10138/309073
Abstract: Despite growing knowledge of a disparity between stated and actual willingness to engage in pro-environmental behavior, little is known about the cognitive or attitudinal factors explaining the disparity. In the context of water quality improvement in a river basin, we address the disparity issue by applying two approaches: a typical valuation question with a hypothetical option of voluntary payment and a valuation question with a real option of voluntary payment. The latter treatment allows for further analysis of the respondents who committed to a real payment. We show empirical evidence on the psychological factors explaining the disparity between the treatments and its relationship with response uncertainty. The extent of learning from the survey about water management of the watershed increased the likelihood of stating the willingness to contribute, either with certainty or uncertainty. In turn, a previous contribution to the environmental issue, higher income, belief in the scenario, and responding to the hypothetical treatment increased the likelihood of stating certain willingness to contribute. Our findings indicate that the factors influencing the decision on the maximum payment differ between treatments. Cognitive factors, such as perceiving the valuation scenario as plausible, learning from the questionnaire, and in which mailing round the respondent completed the survey, only explained the stated amount for the willingness to pay in the treatment with a hypothetical option for voluntary payment. In the real option treatment, a higher stated willingness to pay was more likely if the respondent actually made the payment and had a higher household income.
Subject: Contingent valuation
Freshwater management
Hypothetical bias
Preference certainty
Field study
Real donation
1172 Environmental sciences
512 Business and Management
Peer reviewed: Yes
Rights: unspecified
Usage restriction: openAccess
Self-archived version: acceptedVersion

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