Luận văn thạc sĩ household’s willingness to pay for environmental improvement in van phuc

THAI NGUYEN UNIVERSITY

UNIVERSITY OF AGRICULTURE AND FORESTRY

NGUYEN THE TUNG

TOPIC TITLE:

“HOUSEHOLD’S WILLINGNESS TO PAY FOR ENVIRONMENTAL

IMPROVEMENT IN VAN PHUC HANDICRAFT VILLAGE – HA NOI

USING CONTINGENT VALUATION METHOD (CVM)”

BACHELOR THESIS

Study Mode : Full-time

Major : Environmental Science and Management

Faculty : International Training and Development Center

Batch : 2011-2015

Thai Nguyen, Sept. 2015

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DOCUMENTATION PAGE WITH ABSTRACT

Thai Nguyen University of Agriculture and Forestry

Degree Program Bachelor of Environmental Science and Management

Student name Nguyen The Tung

Student ID DTN1153150089

Thesis Title Household’s willingness to pay for environmental improvement

in Van Phuc traditional handicraft village – Ha Noi using

Contingent Valuation Method (CVM)

Supervisor Ph.D. Nguyen Nghia Bien

Abstract:

This research investigated the willingness to pay for environmental quality

improvement in Van Phuc handicraft village - Ha Dong - Ha Noi using the contingent

valuation method. According to the survey result, Van Phuc handicraft village is

affecting by the environmental pollution. Moreover, the environmental pollution in

Van Phuc handicraft village often contaminated by the waste, mostly comes from

handicraft village activities and industrial activities. However, the villagers are aware

of the environmental pollution in the locality and willing to pay money for

environmental improvement. On average, 88.3% of the households are willing to pay

for improved environmental quality and the average of willingness to pay is 227.641

VND/household/year. The willingness to pay of villager affected by education level,

income, occupation and the amount of household members. In particular, amount of

household member has the clearest impact to the willingness to pay of people living in

Van Phuc handicraft village.

Keywords

Willingness to Pay, Environmental good, Contingent Valuation

Method ; Regression Model

Number of pages 49

Date of Submission 30/9/2015

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CONTENTS

LIST OF FIGURES ..................................................................................................... 1

LIST OF TABLES....................................................................................................... 2

LIST OF ABBREVIATIONS ...................................................................................... 3

ACKNOWLEDGEMENT ........................................................................................... 4

INTRODUCTIONNTRODUCTION ........................................................................ 5

1. Rationale ................................................................................................................. 5

2. Aim and Objectives ................................................................................................. 7

3. Scope and limitation ................................................................................................ 8

4. Research structure .................................................................................................... 8

CHAPTER I: LITERATURE REVIEW ................................................................ 10

1.1. Environment ....................................................................................................... 10

1.2. The total economic value of environmental resources ......................................... 12

1.3. The methods for valuation of environmental resources ....................................... 14

1.4. Consumer surplus ............................................................................................... 15

1.5. Willingness to Pay .............................................................................................. 17

1.6. Contingent Valuation Method ............................................................................. 19

CHAPTER II: RESEARCH METHODS ............................................................... 28

2.1. Methods of data collection .................................................................................. 28

2.1.1. Secondary data collection ................................................................................. 28

2.1.2. Primary data collection .................................................................................... 28

2.2. methods for data analysis .................................................................................... 29

2.2.1. Descriptive statistical method........................................................................... 29

2.2.2. Comparative statistical method ........................................................................ 29

2.2.3. Contingent Valuation Method .......................................................................... 30

2.2.4. WTP regression model ..................................................................................... 32

CHAPTER III: RESEARCH RESULTS AND DISCUSSION ............................. 35

3.1. Basic information about Van Phuc Handicraft village ......................................... 35

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3.1.1. Location, physical and socio-economic condition ............................................ 35

3.1.2. Major economic features .................................................................................. 36

3.1.3. Current environmental status ............................................................................ 38

3.2. sample household reated information .................................................................. 40

3.2.1. Income ............................................................................................................. 40

3.2.2. Age and educational level ................................................................................ 41

3.2.3. Number of household members ........................................................................ 41

3.2.4. Gender ............................................................................................................. 41

3.2.5. Occupation ....................................................................................................... 42

3.3. The information related to household willingness to pay for environmental

improvement status: ................................................................................................... 42

3.3.1. Current environmental situation ....................................................................... 42

3.3.2. The awareness of responder ............................................................................. 44

3.3. estimation of The household willingness to pay for environmental improvement 48

3.4. analysis of factors affecting people’s WTP in van phuc handicraft village .......... 52

3.5. Analyzing the statistical significance .................................................................. 55

3.5.1. Education Level ............................................................................................... 55

3.5.2. Income ............................................................................................................. 56

3.5.3 Amount of household member .......................................................................... 57

3.5.4. Occupation ....................................................................................................... 57

3.5.6. Improving the education and raising the awareness of the people ..................... 60

3.5.7. Increasing people income and their living standards ......................................... 61

3.5.8. Strengthening the population - family planning ................................................ 62

3.5.9. Propagating measures in various forms to people ............................................. 62

CONCLUSION ........................................................................................................ 63

REFERENCES ........................................................................................................ 66

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LIST OF FIGURES

Figure 1.1. Categories of economic values attributed to environmental assets ........... 13

Figure 1.2 Consumer surplus illustrating consumer (red) and producer (blue)

surpluses on a supply and demand chart.................................................... 16

Figure 1.3. The willingness to pay and consumer surplus ......................................... 18

Figure 3.1. Artisan and weaving loom. ..................................................................... 36

Figure 3.2. Untreated wastewater has been directly discharged into the

environment. ............................................................................................. 38

Figure 3.3. Silk making process ................................................................................ 40

Figure 3.4. The rating of interviewees about the environmental situation (Unit:

percentage) ............................................................................................... 42

Figure 3.5. Responder’s awareness of environmental services and payments for

environmental services (Unit: people) ....................................................... 44

Figure 3.6. Proportion of people were participate in training in environmental

services and payments for environmental services (Unit: percentage) ....... 46

Figure 3.7. Result of the Regression Analysis using .................................................. 53

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LIST OF TABLES

Table 3.1 The information related to the interviewees ................................................ 41

Table 3.2. Source of pollution .................................................................................... 43

Table 3.3. Impact of environmental pollution ............................................................ 44

Table 3.4. Some environmental services has been known. ......................................... 45

Table 3.5. Incoming source of information about environmental services. ................. 46

Table 3.6. Awareness of interviewees on paying the fee for environmental services .. 47

Table 3.7. Forms of benefit from environmental services ........................................... 47

Table 3.8. Number of agree and disagree for payments for environmental services.... 48

Table 3.9. Reason for not willingness to pay .............................................................. 48

Table 3.10. The reasons for the willingness to pay for environmental services ........... 49

Table 3.11. The level of willingness to pay of household ........................................... 49

Table 3.12. The reason for the chosen level of WTP. ................................................. 51

Table 3.13. Forms of payment for environmental improvement. ................................ 51

Table 3.14. Correlation matrix between the independent variables ............................. 52

Table 3.15. Summarized result of the Regression Analysis using STATA 11.0. ......... 54

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LIST OF ABBREVIATIONS

BV : Bequest Value

BOD : Biological oxygen demand

CS : Consumer Surplus

CVM : Contigent Valuation Method

COD : Chemical oxygen demand

DUV : Direct Use Value

IUV : Indirect Use Value

EV : Existence Value

MP : Market Price

MoF : Ministry of Finance

MoST : Ministry of Science and Technology

MARD : Ministry of Agriculture and Rural Development

NUV : Non Use Value

OV : Option Value

PFES : Payment for Enviroment Services

TEV : Total Economics Value

TUV : Total Use Value

UV : Use Value

IUV : Indirect Use Value

WTP : Willingness To Pay

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