Willingness to pay for water quality and supply enhancements in the Grand River watershed

Authored by James A. Brox, Ramesh C. Kumar, and Kenneth R. Stollery. Published in 1996.

This paper reports the results of a large contingent valuation survey to estimate the social benefits of water quality improvements in the watershed. Early results indicate a willingness to pay (WTP) for residential water quality improvements of up to $4.50 per household per month (19% of the average water bill), with a somewhat lower value for preserving the environmental quality of parkland in the watershed. Using a 5% discount rate, this translates into a demand for water quality projects in the region with a capital value of nearly 91100 per household. The narrowness of the estimated range of WTP values, and their similarity to values found in other studies, suggests that our estimates are a reliable measure of the monetary value of social benefits from water quality improvements in the region. The main socio-economic determinants of willingness to pay appear to be household income, number of children, perception of existing water quality, and awareness of environmental issues on the part of survey respondents.

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