Haze, health, and income: An integrated model for willingness to pay for haze mitigation in Shanghai, China

Most existing studies indicate that residentsö willingness to pay (WTP) for environmental protection mainly depends on income and the degree of environmental pollution. However, owing to lack of suitable data, less research has focused on why people have higher or lower WTP for environmental protection, and many questions about their reasons remain unanswered. Based on contingent valuation questionnaires in 16 districts of Shanghai, this study investigates the influencing factors of residentsö WTP for haze mitigation. To avoid a multicollinearity problem, we integrate principal component analysis and the probit model to examine the determinants of WTP. Results show that residentsö WTP for haze mitigation ranges from 343.31 to 359.48 USD. The major influencing factors of residentsö WTP include subjective knowledge of haze impacts, understanding of the frequency and severity of haze, and social trust in haze data published by the government. In particular, we find that owing to anti-haze household expenditure on mitigating the effects of haze pollution on health, residents who considered that the areas they lived in were more influenced by haze pollution do not always have higher WTP for haze mitigation. Results of this study have policy implications for haze mitigation regarding the effect of anti-haze household expenditure.