Scandinavian Working Papers in Economics

EfD Discussion Paper,
Environment for Development, University of Gothenburg

No 23-8: Air quality valuation using online surveys in three Asian megacities

Jie-Sheng Tan-Soo (), Eric Finkelstein (), Ping Qin (), Marc Jeuland (), Subhrendu Pattanayak () and Xiaobing Zhang ()
Additional contact information
Jie-Sheng Tan-Soo: Lee Kuan Yew School of Public Policy, National University of Singapore
Eric Finkelstein: Duke-NUS Medical School, Singapore
Ping Qin: School of Applied Economics, Renmin University of China
Marc Jeuland: Sanford School of Public Policy, Duke University, USA
Subhrendu Pattanayak: Sanford School of Public Policy, Duke University, USA
Xiaobing Zhang: School of Economics, Renmin University of China

Abstract: Due to worsening air quality across many cities in developing countries, there is an urgent need to consider more aggressive air pollution control measures. Valuation of the benefits of clean air is crucial for establishing the rationale for such policies, but is methodologically challenging, often expensive, and therefore remains limited. This study assesses the potential for more standardized and cost-effective measurement of the demand for air quality improvements, applying a contingent valuation procedure via online surveys, in three Asian megacities facing severe but varying pollution problems – Beijing, Delhi, and Jakarta. The study’s primary contribution is to demonstrate the viability of this approach, which significantly enhances comparability of valuations and their drivers across locations, and thereby has great potential for informing policy analysis and targeting of specific interventions. A second contribution is to supply sorely needed data on the benefits of clean air in these three particular Asian cities, which collectively have a population of about 50 million people. The annual willingness-to-pay for air quality to reach national standards is estimated to be US$150 in Jakarta (where average PM2.5 concentration, at 45µg/m3, exceeds national standards by the smallest amount, specifically a factor of 1.3), US$1845 in Beijing (PM2.5 at 58µg/m3, 1.7 times the standard), and US$1760 in Delhi (PM2.5 at 133µg/m3, 3.3 times the standard). The methods deployed could be applied more widely to construct a worldwide database of comparable air quality valuations.

Keywords: Low and middle-income countries; air pollution; contingent valuation

JEL-codes: D00

Language: English

49 pages, May 30, 2023

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