Valuing the environment in developing countries: modelling the impact of distrust in public authorities' ability to deliver public services on the citizens' willingness to pay for improved environmental quality

In this paper, we employ the choice experiment method to estimate citizens' valuation of an intervention that proposes to improve the quality of the wastewater deposited in the Ganges River, India. We interviewed 150 randomly selected citizens of Chandernagore, along the banks of the Ganges River, to elicit their willingness to pay (WTP) for this intervention, measured in terms of higher municipality taxes. The findings reveal that almost all of the citizens value wastewater quality, though majority protested the intervention, and stated that they donot trust the authorities for effective management of funds. These protest responses were controlled for with the nested logit model. The results reveal that the citizens are willing to pay significant amounts for improved wastewater quality. Municipalities could rely to some extent on their citizens' WTP higher taxes but municipalities' performance, trustworthiness, accountability, as well as the citizens' perceptions of these, should be improved.