What are Households Willing to Pay for Improved Water Access? Results from a Meta-Analysis

George L. Van Houtven, Subhrendu Pattanayak, Faraz Usmani and Jui-Chen Yang

Ecological Economics, 2017, vol. 136, issue C, 126-135

Abstract: Although several factors contribute to low rates of access to improved water and sanitation in the developing world, it is especially important to understand and measure household demand for these services. One valuable source of information regarding demand is the growing empirical literature that has applied stated preference methods to estimate households' willingness to pay (WTP). Because it is difficult to generalize and support planning based on this scattered literature, we conduct a meta-analysis to take stock of the worldwide sample of household WTP for improved drinking water services. Using 171 WTP estimates drawn from 60 studies, we first describe this sample and then examine the potential factors that explain variation in WTP estimates. Our results suggest that households are willing to pay between approximately $3 and $30 per month for improvements in water access. Specifically, in line with economic theory and intuition, WTP is sensitive to scope (the magnitude of improvement in drinking water services), as well as household income, and stated-preference elicitation method. We demonstrate how our results can be used to predict household-level WTP for selected improvements in drinking water access in regions with low coverage, and find that private benefits exceed the cost of provision.

Keywords: Meta-analysis; Water; Sanitation; Contingent valuation; Willingness to pay (search for similar items in EconPapers)
JEL-codes: Q21 Q25 Q51 Q56 (search for similar items in EconPapers)
Date: 2017
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (21)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:ecolec:v:136:y:2017:i:c:p:126-135

DOI: 10.1016/j.ecolecon.2017.01.023

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