Analysis of the factors influencing willingness to Pay and payout level for watershed Eco-compensation of the Huangbai river basin

ABSTRACT Watershed Ecological Compensation (WEC), an essential institutional framework, is for watershed ecological protection and management in China. The governments play a leading role but watershed residents who are the direct stakeholders are not given enough attention in the legislation and practice of WEC in most river basins. Thereupon, it is necessary to study the resident's willingness to pay (WTP) and willingness to accept (WTA). Based on the field survey data of the Huangbai River Basin, the contingent valuation method, the Probit and Tobit models were used to explore the WTP and its influencing factors of residents in the basin. Additionally, parametric estimation methods were employed to estimate the payout level and willingness to accept (WTA) of residents in watersheds. Results show that 88.84% of the respondents intended to pay for WEC with an average price of 142.24 CNY per year. The crucial factors influencing WTP were environmental awareness, ecological compensation cognition and political outlook. In addition, attention to ecology and satisfaction with water quality are significantly related to their payment levels. Accordingly, the policy makers should balance WTP and basin economic level and explore the implementation of a comprehensive ecological compensation strategy.