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Evaluating the performance of different willingness to pay question formats for valuing environmental restoration in rural China

Published online by Cambridge University Press:  02 October 2006

XU ZHONGMIN ,
JOHN LOOMIS ,
ZHANG ZHIQIANG  and
KUINO HAMAMURA
XU ZHONGMIN
Affiliation:
Cheng Guodong, Long Aihua, State Key Laboratory of Frozen Soil Engineering, CAREERI, Lanzhou, 730000 China
JOHN LOOMIS
Affiliation:
Department of Agricultural and Resource Economics, Colorado State University, Fort Collins, CO 80523
ZHANG ZHIQIANG
Affiliation:
Scientific Information Center for Resources and Environment, CAS, Lanzhou, 730000 China
KUINO HAMAMURA
Affiliation:
Arid Land Research Center, Tottori University, 1390 Hamasaka, Japan
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Abstract

This paper compares protest rates and willingness to pay (WTP) using a payment card versus single and double bounded voter referendum contingent valuation question formats. Using a chi-square test, the payment card had a significantly higher protest rate (6.7 per cent) than the voter referendum question format (2.2 per cent). The median WTP of the single bounded and double bounded referendum format exceeds the payment card by a factor of nine and seven, respectively. The median WTP from the referendum formats represent about 8 per cent of income, while the payment card results represents about 1 per cent of income. These large differences in WTP between question formats are double what have been found in past studies. We believe this result may be due to excessive yea saying at high bid amounts in the dichotomous choice question formats. This behavior may arise in our case study in rural China because citizens have not had a long history of open elections or voting on tax referenda.

Type
Research Article
Information
Environment and Development Economics , Volume 11 , Issue 5 , October 2006 , pp. 585 - 601
Copyright
2006 Cambridge University Press

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Footnotes

The projects were supported by the National Science Foundation of China and the Assessment of Impact and Adaptation of Climate Change. We would like to thank the Managing Editor and two anonymous reviewers for constructive suggestions that have clarified several areas of this paper. As usual, the authors are solely responsible for the content and conclusions of this paper.