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Economic valuation of noise pollution control policy: does the type of noise matter?

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Abstract

As the average noise level and number of noise sources have increased, governments have taken various measures to make soundscapes sustainable. Wise policy decisions require information about the monetary value of noise-control policies. This study elicited people’s willingness to pay (WTP) for noise policies, separating traffic noise from residential noise to compare the value of controlling different types of noise. The contingent valuation method was used for the empirical analysis, with data from South Korea. The results show that the monthly mean WTP of respondents was KRW 3392.3 for residential noise reduction and KRW 3507.1 for transport noise reduction; thus, the WTP for the latter is slightly higher than that for the former. Moreover, about 80% of people are unwilling to pay for a noise policy at all, and that high ratio of people with zero WTP must be taken into consideration in the process of policy formulation and implementation. Respondents’ experiential and psychological factors were found to be more important than their demographics in explaining their WTP for a noise policy. Potential policy implications based on the analysis results are provided.

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Notes

  1. The main differences between CEs and the CVM and the merits of each are well summarized in Wardman and Bristow (2004).

  2. “KRW” refers to the South Korean Won. According to the “Economic Statistics System” by the Bank of Korea (http://ecos.bok.or.kr), USD 1 = KRW 1144.09 in July 2016

  3. As a pre-test, we conducted an online survey of 400 respondents aged 20 to 65 in the same eight metropolitan areas. Data from 13 respondents were excluded because they did not provide complete responses to all questions. In the pre-test, we asked for respondents’ WTP through open-ended questions. According to Kanninen (1993), the initial bid amount in DC formats should be between 12 and 88% of the pre-test results. In our consideration of the WTP value from the pre-test, we removed the top and bottom 15% of the data to remove outliers.

  4. Bond et al. (2002) and Adersson et al. (2013) discussed the relationship between payment periods and the sensitivity of WTP. We choose five years as the payment period because shorter and longer payment periods could be more sensitive on respondents’ WTP.

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Acknowledgments

This work was supported by the Korea Environment Institute (the research project entitled “An integrated approach to environmental valuation via impact pathway analysis”, Project Report 2016-10).

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Authors and Affiliations

  1. Graduate School of Energy & Environment, Seoul National University of Science & Technology, 232 Gongneung-ro, Nowon-gu, Seoul, 01811, South Korea

    Sung-Yoon Huh

  2. Department of Industrial and Management Systems Engineering, Kyung Hee University, 1732 Deogyeong-daero, Giheung-gu, Yongin, Gyeonggi-do, 17104, South Korea

    Jungwoo Shin

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Correspondence to Jungwoo Shin.

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Huh, SY., Shin, J. Economic valuation of noise pollution control policy: does the type of noise matter?. Environ Sci Pollut Res 25, 30647–30658 (2018). https://doi.org/10.1007/s11356-018-3061-4

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