Social Interaction and Public Goods Provision: A Case of Waste Management in Bandung, Indonesia

Martin Siyaranamual ()

No 201312, Working Papers in Economics and Development Studies (WoPEDS) from Department of Economics, Padjadjaran University

Abstract: Successful minimisation of the gap between hypothetical and actual be-haviours requires to consider the dimension of individual social interaction in the decision process. While this dimension has been acknowledged to play an important role in the construction of private good preferences, however, in the context of public good, the role of social interaction has not been adequately examined. Therefore, to shed a light on the role of social interaction in shaping preferences toward public good, I conduct a contingent valuation (CV) study in which the respondents are enabled to have social interactions prior their willingness to pay (WTP) elicitation question. And in order to do this, I construct a sampling design where respondents are divided into three different groups, namely treated, untreated, and control groups. The respondents in the treated and untreated groups were allowed to interact/discuss with each other, within and across groups, prior to the WTP elicitation question. I find that treated and untreated respon-dents with social interactions have higher and significant likelihood to purchase the public good relatively to control respondents. While those who did not have interaction have a lower WTP for the improvement of waste management.

Keywords: Social interactions; Contingent valuation; Bandung; Solid waste manage-ment (search for similar items in EconPapers)
JEL-codes: Q51 R11 R22 (search for similar items in EconPapers)
Pages: 33 pages
Date: 2013-05, Revised 2013-05
New Economics Papers: this item is included in nep-exp, nep-sea, nep-soc and nep-ure
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (1)

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