Environmental and Resource Economics

, Volume 57, Issue 3, pp 453–476 | Cite as

Salt or Sludge? Exploring Preferences for Potable Water Sources

Article

Abstract

Decision makers often use information about public preferences to guide public policy. Several disciplines gather information on preferences through surveys by asking respondents to make hypothetical choices over potential policies. However the context of the choice question differs between approaches, with some failing to make the full consequences of the respondent’s choice explicit in the question. In this study we investigate whether question context matters, by exploring whether economic and psychology approaches yield a similar understanding of community preferences towards a large-scale recycled wastewater scheme. We find that stated preferences differ depending on whether the preference question is contextualised using economic incentives. The findings provide insight into the implications of inappropriately contextualised preference questions, methodological considerations in attitude identification and estimation, and the diversity of values and public attitudes towards recycled wastewater.

Keywords

Non-market valuation Attitudes Recycled wastewater 

References

  1. Aertsens J, Verbeke W, Mondelaers K, Van Huylenbroeck G (2009) Personal determinants of organic food consumption: a review. British Food J 111:1140–1167CrossRefGoogle Scholar
  2. Ajzen I (1991) The theory of planned behaviour. Organ Behav Human Decis Process 50:179–211CrossRefGoogle Scholar
  3. Ajzen I (2011) Theory of planned behaviour: reactions and reflections. Psychol Health 26:1113–11127CrossRefGoogle Scholar
  4. Alberini A (1995) Optimal designs for discrete choice contingent valuation surveys: single-bound, double-bound and bivariate models. J Environ Econ Manag 28:287–306CrossRefGoogle Scholar
  5. Araña JE, León CJ (2008) Repeated dichotomous formats for eliciting willingness to pay: simultaneous estimation and anchoring effects. Environ Resour Econ 36:75–497Google Scholar
  6. Arrow K, Solow R, Portney PR, Leamer EE, Radner R, Schuman EH (1993) Report of the NOAA panel on contingent valuation, report to the General Counsel of the US National Oceanic and Atmospheric Administration. Resources for the Future, WashingtonGoogle Scholar
  7. Australian Bureau of Statistics (2007) 2006 Census Perth population and housing. www.abs.gov.au/Ausstats/abs@.nsf/mf/3222.0. [14 September 2011]
  8. Barrett P (2007) Structural equation modelling: adjudging model fit. Pers Individ Differ 42:815–824CrossRefGoogle Scholar
  9. Bateman IJ, Carson RT, Day B, Hanemann M, Hanley N, Hett T, Jones-Lee M, Loomes G, Mourato S, Özdemiroglu E, Pearce DW, Sugden R, Swanson J (2002) Economics valuation with stated preference techniques: a manual. Edward Elgar, LondonGoogle Scholar
  10. Ben-Akiva M, McFadden D, Gärling T, Gopinath D, Walker J, Bolduc D, Börsch-supan A, Delquié P, Larichev O, Morikawa T, Polydoropoulou A, Rao V (1999) Extended framework for modelling choice behaviour. Mark Lett 10:187–203CrossRefGoogle Scholar
  11. Blamey R, Gordon J, Chapman R (1999) Choice modelling: assessing the environmental values of water supply options. Aust J Agric Resour Econ 43(3):337–357CrossRefGoogle Scholar
  12. Carlsson F, Frykblom P, Lagerkvist CJ (2007) Preferences with and without process—does the price attribute affect behaviour in stated preference surveys? Environ Resour Econ 38:155–164CrossRefGoogle Scholar
  13. Carson RT, Groves T (2007) Incentive and informational properties of preference questions. Environ Resour Econ 37:181–210CrossRefGoogle Scholar
  14. Carson RT, Louviere JJ (2011) A common nomenclature for stated preference elicitation approaches. Environ Resour Econ 49:539–559CrossRefGoogle Scholar
  15. Carson KS, Chilton SM, Hutchinson WG (2009) Necessary conditions for demand revelation in double referenda. J Environ Econ Manag 57:219–225CrossRefGoogle Scholar
  16. Cook AJ, Kerr GN, Moore K (2002) Attitudes and intentions towards purchasing GM food. J Econ Psychol 23:557–572CrossRefGoogle Scholar
  17. DellaVigna S (2009) Psychology and economics: evidence from the field. J Econ Lit 47:315–372CrossRefGoogle Scholar
  18. Dolnicar S, Schäfer AI (2009) Desalinated versus recycled water: public perceptions and profiles of the accepters. J Environ Manag 90:888–900CrossRefGoogle Scholar
  19. Dolnicar S, Hurlimann A, Grün B (2011) What affects public acceptance of recycled and desalinated water? Water Res 45:933–943CrossRefGoogle Scholar
  20. East R (1993) Investment decisions and the theory of planned behaviour. J Econ Psychol 14:337–375CrossRefGoogle Scholar
  21. Gibson FL, Burton M (2011) Determining the change in welfare estimates from introducing measurement error in non-linear choice models. Working paper 1110, School of Agricultural and Resource Economics, University of Western AustraliaGoogle Scholar
  22. Hair JF Jr, Black WC, Babin BJ, Anderson RE, Tatham RL (2006) Multivariate data analysis, 6th edn. Pearson Education International, New JerseyGoogle Scholar
  23. Hanemann MW (2006) The economic concept of water. In: Rogers PP, Llamas MR, Cortina LM (eds) Water crisis: myth or reality?. Taylor and Francis, LondonGoogle Scholar
  24. Hanemann MW, Kanninen B (1999) The statistical analysis of discrete-response data. In: Bateman IJ, Willis KG (eds) Valuing environmental preferences: theory and practice of the contingent valuation method in the US, EU, and developing countries. Oxford University Press, OxfordGoogle Scholar
  25. Hanemann WM, Loomis JB, Kanninen B (1991) Statistical efficiency of double-bounded dichotomous choice contingent valuation. Am J Agric Econ 73:1255–1263CrossRefGoogle Scholar
  26. Hartley TW (2006) Public perception and participation in water reuse. Desalination 187:115–126CrossRefGoogle Scholar
  27. Hurlimann AC (2009) Water supply in regional Victoria Australia: a review of the water cartage industry and willingness to pay for recycled water. Resour Conserv Recycl 53:262–268CrossRefGoogle Scholar
  28. Hurlimann AC, McKay J (2007) Urban Australians using recycled water for domestic non-potable use: an evaluation of the attributes price, saltiness, colour and odour using conjoint analysis. J Environ Manag 83:93–104CrossRefGoogle Scholar
  29. Kriström B (1997) Spike models in contingent valuation. Am J Agric Econ 79:1013–1023CrossRefGoogle Scholar
  30. Lindhjem H, Navrud S (2011) Are internet surveys an alternative to face-to-face interviews in contingent valuation? Ecol Econ 70:1628–1637CrossRefGoogle Scholar
  31. Marks J, Martin B, Zadoroznyj M (2008) How Australians order acceptance of recycled water: national baseline data. J Sociol 44(1):83–99CrossRefGoogle Scholar
  32. McFadden D (1999) Rationality for economists? J Risk Uncertain 19:73–105CrossRefGoogle Scholar
  33. Meerganz von Medeazza GL (2005) Direct and socially-induced environmental impacts of desalination. Desalination 185:57–70CrossRefGoogle Scholar
  34. Morikawa T, Ben-Akiva M, McFadden D (2002) Discrete choice models incorporating revealed preferences and psychometric data. Econom Models Mark 16:29–55Google Scholar
  35. Muthèn LK, Muthèn BO (2007) Mplus users guide, 5th edn. Muthèn and Muthèn, Los AngelesGoogle Scholar
  36. Muthèn BO, Satorra A (1995) Technical aspects of Muthèn’s LISCOMP approach to estimation of latent variable relations with a comprehensive measurement model. Psychometrika 60(4):489–503CrossRefGoogle Scholar
  37. Nancarrow BE, Leviston Z, Po M, Porter NB, Tucker DI (2008) What drives communities’ decisions and behaviour in the reuse of wastewater. Water Sci Technol 57:485–491CrossRefGoogle Scholar
  38. National Water Commission (2007) The cost-effectiveness of rainwater tanks in urban Australia. Marsden Jacob Associates, AustraliaGoogle Scholar
  39. Neill HR, Cummings RG, Ganderton PT, Harrison GW, McGuckin T (1994) Hypothetical survey’s and real economic commitments. Land Econ 70:145–154CrossRefGoogle Scholar
  40. Olsen SB (2009) Choosing between internet and mail survey modes for choice experiment surveys considering non-market goods. Environ Resour Econ 44:592–610CrossRefGoogle Scholar
  41. Pidgeon NF, Lorenzoni I, Poortinga W (2008) Climate change or nuclear power—no thanks! A quantitative study of public perceptions and risk framing in Britain. Glob Environ Change 18:69–85CrossRefGoogle Scholar
  42. Poe GL, Giraud KL, Loomis JB (2005) Computational methods for measuring the difference of empirical distributions. Am J Agric Econ 87:353–365CrossRefGoogle Scholar
  43. Porter NB, Leviston Z, Nancarrow BE, Po M, Syme GJ (2005) Interpreting householder preferences to evaluate water supply systems: an attitudinal model. CSIRO Water for a Healthy Country National Research Flagship, PerthGoogle Scholar
  44. Pouta E (2004) Attitude and belief questions as a source of context effect in a contingent valuation survey. J Econ Psychol 25:229–242Google Scholar
  45. Ready RC, Champ PA, Lawton JL (2010) Using respondent uncertainty to mitigate hypothetical bias in a stated choice experiment. Land Econ 86:363–381Google Scholar
  46. Rodriguez C, Van Buynder P, Lugg R, Blair P, Devine B, Cook A, Weinstein P (2009) Indirect potable reuse: a sustainable water supply alternative. Int J Environ Res Public Health 6:1174–1209CrossRefGoogle Scholar
  47. Scarpa R, Thiene M (2011) Organic food choices and protection motivation theory: addressing the psychological sources of heterogeneity. Food Quality Preference 22:532–541CrossRefGoogle Scholar
  48. Scheufele G, Bennett J (2012) Response strategies and learning in discrete choice experiments. Environ Res Econ 52:435–453CrossRefGoogle Scholar
  49. Shwom R, Dan A, Dietz T (2008) The effects of information and state of residence on climate change policy preferences. Clim Change 90:343–358CrossRefGoogle Scholar
  50. Skrondal A, Rabe-Hesketh S (2005) Structural equation modelling: categorical variables. Encyclopedia of statistics in behavioural science. Wiley, New YorkGoogle Scholar
  51. Train KE, McFadden DL, Goett AA (1987) Consumer attitudes and voluntary rate schedules for public utilities. Rev Econ Stat 69:383–391CrossRefGoogle Scholar
  52. Tsiourtis NX (2001) Desalination and the environment. Desalination 141:223–236CrossRefGoogle Scholar
  53. Veronesi M, Alberini A, Cooper JC (2011) Implications of bid design and willingness-to-pay distribution for starting point bias in double-bounded dichotomous choice contingent valuation surveys. Environ Resour Econ 49:199–215CrossRefGoogle Scholar
  54. Water Corporation (2006) Desalinisation. Paper prepared for the Australian State of the Environment Committee, Department of the Environment and Heritage, CanberraGoogle Scholar
  55. Water Corporation (2009) Water forever: towards climate resilience. Water Corporation: Perth. Available from: Water Corporation. [30 November 2010]Google Scholar
  56. Weinstein ND (1993) Testing four competing theories of health-protective behaviour. Health Psychol 12: 324–333CrossRefGoogle Scholar

Copyright information

© Springer Science+Business Media Dordrecht 2013

Authors and Affiliations

  1. 1.Centre for Environmental Economics and Policy, School of Agricultural and Resource EconomicsUniversity of Western AustraliaCrawleyAustralia
  2. 2.School of Agricultural and Resource EconomicsUniversity of Western AustraliaCrawleyAustralia

Personalised recommendations