Measuring the Economic Benefits of the Tap Water Supply Service in Urban Areas: The Case of Korea

Won Seok Lee; Seung Hoon Yoo; Jeehyeong Kim

doi:10.1007/s11269-012-0206-y

Measuring the Economic Benefits of the Tap Water Supply Service in Urban Areas: The Case of Korea

Won Seok Lee, Seung Hoon Yoo, Jeehyeong Kim

Research output: Contribution to journal › Article › peer-review

10 Citations (Scopus)

Abstract

This paper attempts to measure the economic benefits of tap water supply services in some urban areas of Korea. According to micro-economic theory, the economic benefit of water consumed is the sum of the actual water price and the additional willingness to pay (WTP) for the consumption. We apply the dichotomous choice contingent valuation method to assess the additional WTP using specific cases of four cities located in the metropolitan area of Korea. Both parametric and non-parametric approaches to obtaining the mean WTP estimates are used. The results show that the mean additional WTP for the tap water supply service is estimated to be KRW 163.38 (USD 0.13) and KRW 223.89 (USD 0.18) per m³ using parametric and non-parametric approaches, respectively. Given that the price of tap water is 641.66 per m³, the residents' economic benefits that ensue from the tap water supply service are computed as KRW 805.04 (USD 0.63) and KRW 865.55 (USD 0.68) per m³, respectively. This information can be beneficially utilized in conducting an economic feasibility study for a new project related to tap water supply service.

Original language	English
Pages (from-to)	619-627
Number of pages	9
Journal	Water Resources Management
Volume	27
Issue number	2
DOIs	https://doi.org/10.1007/s11269-012-0206-y
Publication status	Published - 2013

Keywords

Benefit
Contingent valuation
Tap water supply service
Willingness to pay

ASJC Scopus subject areas

Civil and Structural Engineering
Water Science and Technology

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10.1007/s11269-012-0206-y

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title = "Measuring the Economic Benefits of the Tap Water Supply Service in Urban Areas: The Case of Korea",

abstract = "This paper attempts to measure the economic benefits of tap water supply services in some urban areas of Korea. According to micro-economic theory, the economic benefit of water consumed is the sum of the actual water price and the additional willingness to pay (WTP) for the consumption. We apply the dichotomous choice contingent valuation method to assess the additional WTP using specific cases of four cities located in the metropolitan area of Korea. Both parametric and non-parametric approaches to obtaining the mean WTP estimates are used. The results show that the mean additional WTP for the tap water supply service is estimated to be KRW 163.38 (USD 0.13) and KRW 223.89 (USD 0.18) per m3 using parametric and non-parametric approaches, respectively. Given that the price of tap water is 641.66 per m3, the residents' economic benefits that ensue from the tap water supply service are computed as KRW 805.04 (USD 0.63) and KRW 865.55 (USD 0.68) per m3, respectively. This information can be beneficially utilized in conducting an economic feasibility study for a new project related to tap water supply service.",

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author = "Lee, {Won Seok} and Yoo, {Seung Hoon} and Jeehyeong Kim",

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AU - Yoo, Seung Hoon

AU - Kim, Jeehyeong

PY - 2013

Y1 - 2013

N2 - This paper attempts to measure the economic benefits of tap water supply services in some urban areas of Korea. According to micro-economic theory, the economic benefit of water consumed is the sum of the actual water price and the additional willingness to pay (WTP) for the consumption. We apply the dichotomous choice contingent valuation method to assess the additional WTP using specific cases of four cities located in the metropolitan area of Korea. Both parametric and non-parametric approaches to obtaining the mean WTP estimates are used. The results show that the mean additional WTP for the tap water supply service is estimated to be KRW 163.38 (USD 0.13) and KRW 223.89 (USD 0.18) per m3 using parametric and non-parametric approaches, respectively. Given that the price of tap water is 641.66 per m3, the residents' economic benefits that ensue from the tap water supply service are computed as KRW 805.04 (USD 0.63) and KRW 865.55 (USD 0.68) per m3, respectively. This information can be beneficially utilized in conducting an economic feasibility study for a new project related to tap water supply service.

AB - This paper attempts to measure the economic benefits of tap water supply services in some urban areas of Korea. According to micro-economic theory, the economic benefit of water consumed is the sum of the actual water price and the additional willingness to pay (WTP) for the consumption. We apply the dichotomous choice contingent valuation method to assess the additional WTP using specific cases of four cities located in the metropolitan area of Korea. Both parametric and non-parametric approaches to obtaining the mean WTP estimates are used. The results show that the mean additional WTP for the tap water supply service is estimated to be KRW 163.38 (USD 0.13) and KRW 223.89 (USD 0.18) per m3 using parametric and non-parametric approaches, respectively. Given that the price of tap water is 641.66 per m3, the residents' economic benefits that ensue from the tap water supply service are computed as KRW 805.04 (USD 0.63) and KRW 865.55 (USD 0.68) per m3, respectively. This information can be beneficially utilized in conducting an economic feasibility study for a new project related to tap water supply service.

KW - Benefit

KW - Contingent valuation

KW - Tap water supply service

KW - Willingness to pay

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Measuring the Economic Benefits of the Tap Water Supply Service in Urban Areas: The Case of Korea

Abstract

Keywords

ASJC Scopus subject areas

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