Valuation of the External Cost Caused by the Environmental Pollution of Three Lakes in Northern Greece

The preservation/restoration of natural environment is usually entailing high cost mostly paid by citizens through taxes. The effect of these taxes is double. The direct effect is the obvious additional income for the State, and the indirect effect is an additional income for the citizen, due to increasing tourism. Since the evaluation of this good cannot be in market terms, authors apply a modified CVM (Contingent Valuation Method), which is part of Experimental Economics, in order to find out the order of concern that people have about natural environment. Authors also, try to investigate their WTP (Willingness To Pay) for supporting activities for preservation/restoration of three lakes in Northern Greece, in particular, lake of Ioannina, lake of Florina and lake of Kastoria. For the purpose of this research, authors use parametric and non-parametric approaches, as well as Linear Regression and Logic Models.