Spatial heterogeneity and transboundary pollution: a contingent valuation study on the Xijiang River drainage basin in south China

Jie He, Anping Huang and Luodan Xu
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Anping Huang: Lingnan (University College), University of Sun Yat-sen, China
Luodan Xu: Lingnan (University College), University of Sun Yat-sen, China

Cahiers de recherche from Departement d'économique de l'École de gestion à l'Université de Sherbrooke

Abstract: This article examines whether and how transboundary river water pollution spillover may affect resident’s Willingness to Pay (WTP) for a river water quality improvement project. Based on a CVM survey conducted in 20 cities located in the Xijiang river basin located in south China, our study demonstrates that the downstream city respondents report lower WTP when the water quality in the immediate upstream city is more polluted. This negative externality decreases with distance and relative bargaining power of downstream city. The simulated potential gain in social benefit if an integrated river basin management (IRBM) were installed, which is supposed to remove respondents’ concerns about negative externality of transboundary river pollution is found to be significant. We can consider this social benefit as upper bound for the transfer from downstream to upstream regions to ensure the reduction of transboundary river pollution spillovers in the Ecological Service Payment (ESP) regime, a hotly debated market-based environmental policy which is under polit project in some regions in China.

Keywords: transboundary water pollution; river; negative externality; spatial; contingent valuation; river water management; ecological service payment; China (search for similar items in EconPapers)
Pages: 49 pages
Date: 2015-03
New Economics Papers: this item is included in nep-agr, nep-cna, nep-env, nep-tra and nep-ure
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (6)

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Journal Article: Spatial heterogeneity and transboundary pollution: A contingent valuation (CV) study on the Xijiang River drainage basin in south China (2015)
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Persistent link: https://EconPapers.repec.org/RePEc:shr:wpaper:15-04

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