Microcredit and willingness to pay for environmental quality: Evidence from a randomized-controlled trial of finance for sanitation in rural Cambodia
Low willingness to pay (WTP) for environmental quality in developing countries is a key research question in environmental economics. One explanation is that missing credit markets may suppress WTP for environmental improvements that require large up-front investments. We test the impact of microloa...
| Main Authors: | , , , , , , |
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| Format: | Journal Article |
| Language: | Inglés |
| Published: |
Elsevier
2017
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| Subjects: | |
| Online Access: | https://hdl.handle.net/10568/148015 |
| _version_ | 1855538501866487808 |
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| author | BenYishay, Ariel Fraker, Andrew Guiteras, Raymond Palloni, Giordano Shah, Neil Buddy Shirrell, Sturat Wang, Paul |
| author_browse | BenYishay, Ariel Fraker, Andrew Guiteras, Raymond Palloni, Giordano Shah, Neil Buddy Shirrell, Sturat Wang, Paul |
| author_facet | BenYishay, Ariel Fraker, Andrew Guiteras, Raymond Palloni, Giordano Shah, Neil Buddy Shirrell, Sturat Wang, Paul |
| author_sort | BenYishay, Ariel |
| collection | Repository of Agricultural Research Outputs (CGSpace) |
| description | Low willingness to pay (WTP) for environmental quality in developing countries is a key research question in environmental economics. One explanation is that missing credit markets may suppress WTP for environmental improvements that require large up-front investments. We test the impact of microloans on WTP for hygienic latrines via a randomized controlled trial in 30 villages in rural Cambodia. We find that microcredit dramatically raises WTP for improved latrines, with 60% of households in the Financing arm willing to purchase at an unsubsidized price, relative to 25% in the Non-financing arm. Effects on latrine installation are positive but muted by several factors, including a negative peer effect: randomly induced purchases by neighbors reduce a household's probability of installing its own latrine. On methodological grounds, this paper shows that a “decision-focused evaluation” can be integrated into academic analysis to provide insight into questions of general interest. |
| format | Journal Article |
| id | CGSpace148015 |
| institution | CGIAR Consortium |
| language | Inglés |
| publishDate | 2017 |
| publishDateRange | 2017 |
| publishDateSort | 2017 |
| publisher | Elsevier |
| publisherStr | Elsevier |
| record_format | dspace |
| spelling | CGSpace1480152025-02-24T06:49:32Z Microcredit and willingness to pay for environmental quality: Evidence from a randomized-controlled trial of finance for sanitation in rural Cambodia BenYishay, Ariel Fraker, Andrew Guiteras, Raymond Palloni, Giordano Shah, Neil Buddy Shirrell, Sturat Wang, Paul willingness to pay microcredit households randomized controlled trial becker-degroot-marschak mechanism hygiene environmental economics credit finance Low willingness to pay (WTP) for environmental quality in developing countries is a key research question in environmental economics. One explanation is that missing credit markets may suppress WTP for environmental improvements that require large up-front investments. We test the impact of microloans on WTP for hygienic latrines via a randomized controlled trial in 30 villages in rural Cambodia. We find that microcredit dramatically raises WTP for improved latrines, with 60% of households in the Financing arm willing to purchase at an unsubsidized price, relative to 25% in the Non-financing arm. Effects on latrine installation are positive but muted by several factors, including a negative peer effect: randomly induced purchases by neighbors reduce a household's probability of installing its own latrine. On methodological grounds, this paper shows that a “decision-focused evaluation” can be integrated into academic analysis to provide insight into questions of general interest. 2017-11 2024-06-21T09:23:40Z 2024-06-21T09:23:40Z Journal Article https://hdl.handle.net/10568/148015 en https://doi.org/10.1016/j.jeem.2016.11.004 Open Access Elsevier BenYishay, Ariel; Fraker, Andrew; Guiteras, Raymond; Palloni, Giordano; Shah, Neil Buddy; Shirrell, Sturat; and Wang, Paul. 2017. Microcredit and willingness to pay for environmental quality: Evidence from a randomized-controlled trial of finance for sanitation in rural Cambodia. Journal of Environmental Economics and Management 86(November 2017): 121-140. https://doi.org/10.1016/j.jeem.2016.11.004 |
| spellingShingle | willingness to pay microcredit households randomized controlled trial becker-degroot-marschak mechanism hygiene environmental economics credit finance BenYishay, Ariel Fraker, Andrew Guiteras, Raymond Palloni, Giordano Shah, Neil Buddy Shirrell, Sturat Wang, Paul Microcredit and willingness to pay for environmental quality: Evidence from a randomized-controlled trial of finance for sanitation in rural Cambodia |
| title | Microcredit and willingness to pay for environmental quality: Evidence from a randomized-controlled trial of finance for sanitation in rural Cambodia |
| title_full | Microcredit and willingness to pay for environmental quality: Evidence from a randomized-controlled trial of finance for sanitation in rural Cambodia |
| title_fullStr | Microcredit and willingness to pay for environmental quality: Evidence from a randomized-controlled trial of finance for sanitation in rural Cambodia |
| title_full_unstemmed | Microcredit and willingness to pay for environmental quality: Evidence from a randomized-controlled trial of finance for sanitation in rural Cambodia |
| title_short | Microcredit and willingness to pay for environmental quality: Evidence from a randomized-controlled trial of finance for sanitation in rural Cambodia |
| title_sort | microcredit and willingness to pay for environmental quality evidence from a randomized controlled trial of finance for sanitation in rural cambodia |
| topic | willingness to pay microcredit households randomized controlled trial becker-degroot-marschak mechanism hygiene environmental economics credit finance |
| url | https://hdl.handle.net/10568/148015 |
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