Willingness to Pay for Air Quality Improvements in Sofia, Bulgaria

People in Sofia are willing to pay 4.2 percent of their income or more for a program to improve air quality. Through a survey, Wang and Whittington study willingness to pay for improvements in air quality in Sofia, Bulgaria. Using a stochastic payment card approach - asking respondents the likelihood that they would agree to pay a series of prices - they estimate the distribution of willingness to pay various prices. They find that people in Sofia are willing to pay up to about 4.2 percent of their income for a program to improve air quality. The income elasticity of willingness to pay for air quality improvements is about 27 percent. For comparison, they also used the referendum contingent valuation approach. Results from that approach yielded a higher estimate of willingness to pay. This paper - a product of Infrastructure and Environment, Development Research Group - is part of a larger effort in the group to understand the economics of pollution control in developing countries