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The relationship between environmental values and income in a transition economy: surface water quality in Latvia

Published online by Cambridge University Press:  01 February 2002

Richard C. Ready ,
Jânis Malzubris  and
Silva Senkane
Richard C. Ready
Affiliation:
Department of Agricultural Economics and Rural Sociology, Pennsylvania State University, University Park, PA 16802, USA. Tel: 1–814–863–5575. Fax: 1–814–865–3746. E-mail: [email protected]
Jânis Malzubris
Affiliation:
University of Latvia, Riga, Latvia.
Silva Senkane
Affiliation:
Latvian Academy of Culture, Riga, Latvia.
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Abstract

A contingent valuation study measured citizen willingness to pay (WTP) for an improvement in surface water quality in Latvia. The average respondent was willing to pay 0.7 per cent of household income for the environmental improvement, but that amount was much less than needed to finance the required investments in treatment facilities. While the income elasticity of WTP for the average resident was low (0.56), it increases as income increases, reaching 0.9 at an income level double the current average. As real incomes increase in Latvia, the demand for environmental quality by citizens can be expected to increase substantially.

Type
Research Article
Information
Environment and Development Economics , Volume 7 , Issue 1 , February 2002 , pp. 147 - 156
Copyright
© 2002 Cambridge University Press

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Footnotes

The authors would like to thank Bruce Larson and Aija Koszlovzka for their help before and during the research project. This research was sponsored by the Harvard Institute for International Development. The authors are solely responsible for its content.