Contingent Valuation Machine Learning (CVML) : A Novel Method for Estimating Citizens’ Willingness- to- Pay for Safer and Cleaner Environment

This paper introduces an advanced method that integrates contingent valuation and machine learning (CVML) to estimate residents’ demand for reducing or mitigating environmental pollutions and climate change. To be precise, CVML is an innovative hybrid machine-learning model, and it can leverage a limited amount of survey data for prediction and data enrichment purposes. The model comprises of two interconnected modules: Module I, an unsupervised learning algorithm, and Module II, a supervised learning algorithm. Module I is responsible for grouping the data into groups based on common characteristics, thereby grouping the corresponding dependent variable, whereas Module II is in charge of demonstrating the ability to predict and the capacity to appropriately assign new samples to their respective category based on input attributes. Take a survey on the topic of air pollution in Hanoi in 2019 as an example, we found that CVML can predict households’ willingness– to– pay for polluted air mitigation at a high degree of accuracy (i.e., 98%). We also found that CVML can help users reduce costs or save resources because it makes use of using the secondary data that exist on many open-data sources for estimating the WTP. These findings suggest that CVML is a powerful and practical method that would be potentially widely applied in many fields, particularly environmental economics and sustainability science in years to come