Title Revealed Willingness-to-pay for Reduction of Air Pollution Risks in Urban China
 Collaborators Guodong Sun (CMU), H. Keith Florig (CMU)
 Keywords Air pollution, China, willingness-to-pay, revealed preference
 Abstract One important component of the benefits of GHG emissions
controls is the accompanying reduction of particulate air pollution and
its public health impacts. If the benefits of GHG emissions controls are
to be properly valued, it is important to understand how to value the
reduction of air pollution risks in different regions of the world.
Economic theory suggests that societal willingness-to-pay (WTP) for risk
reduction should increase with economic development, but there are no
empirical studies that have examined this relationship in the context of
air pollution damages in rapidly industrializing countries. This research
will shed light on this question by studying revealed WTP for local air
pollution control in several cities in China. China began to address urban
air pollution problems in the early 1980s, and has implemented a
succession of laws, regulations, and administrative orders aimed at
eventually bringing urban particulate levels into compliance with Chinese
national air quality standards. Implementation of air pollution measures
has been quite uneven from city-to-city, however, presumably reflecting
uneven economic development across China. This study will examine the
history of air pollution control measures in several different Chinese
cities that span the spectrum of economic development. A timeline of
control measures for the past 15-20 years will be constructed, and the
timing of implementation will be compared with per capita income. Models of pollutant emission reduction, pollutant diffusion, population location, population time use, and health damage will be developed to estimate the air quality improvement, exposure reduction, and public health benefits of these measures. The associated costs of the air pollution control measures will also be estimated and combined with the estimate of health benefits to obtain a revealed WTP for risk reduction. Different metrics of development will be used to investigate how willingness-to-pay tracks with levels of different measures of development. Uncertainties and
variabilities will be considered. Results from this study will establish
some cost and timing benchmarks for climate change and air pollution
control policies in China.