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Households’ willingness to pay (WTP) for water quality improvements—representing their economic value—depends on where improvements occur. Households often hold higher values for improvements close to their homes or iconic areas. Are there other areas where improvements might hold high value to individual households, do effects on WTP vary by type of improvement, and can these areas be identified even if they are not anticipated by researchers? To answer these questions, we integrated a water quality model and map-based, interactive choice experiment to estimate households’ WTP for water quality improvements throughout a river network covering six New England states. The choice experiment was implemented using a push-to-web survey over a sample of New England households. Voting scenarios used to elicit WTP included interactive geographic information system (GIS) maps that illustrated three water quality measures at various zoom levels across the study domain. We captured data on how respondents maneuvered through these maps prior to answering the value-eliciting questions. Results show that WTP was influenced by regionwide quality improvements and improvements surrounding each respondent’s home, as anticipated, but also by improvements in individualized locations identifiable via each respondent’s map interactions. These spatial WTP variations only appear for low-quality rivers and are focused around particular areas of New England. The study shows that dynamic map interactions can convey salient information for WTP estimation and that predicting spatial WTP heterogeneity based primarily on home or iconic locations, as typically done, may overlook areas where water quality has high value.
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Water Allocation, Return Flows, and Economic Value in Water-Scarce Environments: Results from a Coupled Natural-Human System Model
In many parts of the world including the western United States, the allocation of water is governed by complex water laws that dictate who receives water, how much they receive, and when. Because these rules are generally based on the seniority of water rights, they are not necessarily focused on maximizing economic value across the entire economy. The maximization of value from water use economy-wide is a complex optimization problem that must explicitly consider each user’s water demand, willingness to pay (WTP) function, and the feedbacks among users in a coupled natural-human system model. In this study, we distill these complexities into a simple MATLAB® model developed to represent a two-user economy with water-dependent sectors representative of agriculture and industry. We feed the model with realistic values of relative water use, relative willingness to pay, and return flows to explore the relationships among these factors in water-limited systems. We find that the total economic value generated from water-dependent users depends primarily on the total water available in the system. However, for a given volume of water available, economic value is not necessarily maximized when all the water is appropriated to the user with the highest WTP. Rather, total economic value depends on the amount of water available, the relative WTP between the two users, and on the return flows generated from each sector’s water use. While our simple two-user model is a significant abstraction of the complexities inherent in natural systems, our study provides important insights into the coupled natural-human system dynamics of water allocation and use in water-limited environments.
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- Award ID(s):
- 2009922
- PAR ID:
- 10448708
- Date Published:
- Journal Name:
- Water
- Volume:
- 14
- Issue:
- 20
- ISSN:
- 2073-4441
- Page Range / eLocation ID:
- 3280
- Format(s):
- Medium: X
- Sponsoring Org:
- National Science Foundation
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- Free Publicly Accessible Full Text
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Accepted Manuscript1.0
- Journal Article:
- https://doi.org/10.3390/w14203280
