Willingness to Pay for Air Pollution Control: Case Study of Webuye Town and Its Environs in Kenya

Abstract

Environmental science research has established adverse effects of air pollution on human health, economic property and the environment. The Pulp and Paper Mills located in Webuye Township emits toxic gases that pollute air and water systems. The purpose of this study was to elicit the willingness to pay (WTP) among Webuye residents, for an improvement in air quality. Contrary to the common thinking that improvement in air quality in low income settlements must be financed by the government or its agencies, this study was undertaken to determine the value that urban residents, and neighbouring rural households, place on clean air. It was hoped that an optimum price reflecting the maximum amount of money individuals were willing to pay would be used as a strategy for cost recovery establishment.

The study used primary cross-section data to capture household socio-economic profiles, air pollution related problems and their WTP for air pollution reduction. A structured contingent valuation questionnaire was administered to 184 households that were randomly sampled. Two models were estimated. The first model is a dichotomous choice model - in which parameters defining WTP probability function were estimated. The second model investigated factors influencing the monetary bids respondents were willing to pay.

The findings from the OLS regression reveals that an individuals' income, the expenditure incurred on treating the sick members suffering from air pollution related diseases, years of schooling, separating distance between the pollution source and the location of the households were significant at the 95% level. Other factors such as family size, ranking of air pollution problem, gender, marital status and age of an individual were related with the amount one contributed but were not significant at the 5% level. However, in the logit model, only individual's income and marital status were significant. Other factors investigated such as family size, ranking of air pollution problem, gender, individual's age, separating distance, years of schooling and the expenditure incurred on treating sick members were related to the probability of giving a positive answer, though were not significant.

Two important policy implications ,can be drawn from the findings. First, the factory's management should improve in its technology by installing equipment that will reduce the amount of toxic gases emitted. Secondly, residents should form lobby groups through which they can educate others on the awareness of air pollution problems. Thus with these groups, they can pressurise the management to reduce air pollution. However, other researchers can analyse the impacts of specific gaseous emissions on economic property and human health. They can also establish the economic price associated with pollution in general-thus incorporating all types of pollution.