The Role of Cultural Worldviews in Willingness to Pay for Environmental Policy

Paul A. Hindsley and O. Ashton Morgan

No 20-03, Working Papers from Department of Economics, Appalachian State University

Abstract: Recent research in the social psychology literature suggests that personally held beliefs may play a pivotal role in individuals’ acceptance of environmental policy. We extend previous work in this area by providing a contingent valuation method (CVM) framework that examines the interaction between cultural worldviews and willingness to pay for a policy that mitigates environmental risk. Results from a bivariate probit model indicate that individuals with communitarian and egalitarian worldviews are willing to pay significantly more for the environmental policy. We further investigate the role of cultural worldview on individuals’ support for, and valuation of, environmental policies that differ by their underlying cause. Again, cultural worldview is important and point estimates of mean willingness to pay increase if the proposed policy is designed to mitigate the effects of climate change-related issues as opposed to a more local pollution threat. Finally, results indicate that cultural worldviews also influence respondents’ perceived consequentiality with potentially important ramifications for eliciting stated preferences in a CVM framework. Key Words: Contingent valuation; cultural worldview; willingness to pay; environmental policy

Date: 2020
New Economics Papers: this item is included in nep-agr, nep-dcm and nep-env
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Citations: View citations in EconPapers (1)

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Persistent link: https://EconPapers.repec.org/RePEc:apl:wpaper:20-03

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