• Journal of Korean Society of Water and Wastewater
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• v.28 no.5
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• pp.561-571
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• 2014

The paper is to estimate willingness-to-pay (WTP) for tap water quality improvement in Busan, using parametric approach in contingent valuation method(CVM). For parametric approach linear logit model and log logit model are employed in double-bounded dichotomous choice format of CVM. For the reliability and the validity of contingent valuation method a survey was conducted for 665 respondents, who were sampled by stratified random sampling method, by personal interview method. The result of mean WTP for the tap water quality improvement in Busan was estimated to be 3,687 won and 3,660 won per month per household, while median WTP being 1,884 won and 1,892 won per month per household, respectively by linear logit model and log logit model. Provided that our sample is broadly representative of the Busan's population, an estimate of the annual aggregated benefit of residential water improvement for all Busan households is approximately 29.7 billion won to 29.8 billion won based on median WTP.

• Asia Marketing Journal
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• v.18 no.4
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• pp.27-49
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• 2017

The two competing underlying mechanisms of anchoring, anchoring-and-adjustment and selective accessibility, have very different managerial implications for the effect of price as an anchor on willingness-to-pay (WTP). To clarify their relative roles in inducing the anchoring effect, path analysis modeling in which two paths are included in a single model was utilized. The first path proceeds directly from anchor price to WTP, representing anchor-and-adjustment. The second path, representing selective accessibility, includes a mediator formed by various explanatory variables of WTP. The results consistently show that only the direct path, anchoring-and-adjustment, is significant. The results also show that the level of available product information has no significant moderation effect on both of the paths, which implies the robustness of the result with respect to information level.

• Health Policy and Management
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• v.16 no.1
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• pp.95-116
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• 2006

According to rapid increase of the population of senior citizens, there has been growing concern of Long-Tenn Care(LTC) services recently. Long-Tenn Care services, however, haven't been established systematically in Korea and the supply of LTC services is not sufficient despite the increase in the current social demand. This study aims to estimate the 'Willingness to Pay(WTP)' for LTC insurance which the government plans to introduce by means of social insurance, using Contingent Valuation Method(CYM). In addition, this study analyzes the factors affecting WTP for LTC insurance. An interview survey was carried out to derive WTP for LTC from 450 people who lived in Seoul aged 20 and above during the period from 16th to 21st of June 2003. Double-Bounded Dichotomous Choice Method was applied among several CVMs available to estimate both use value and no-use value of goods. There was pilot survey carried out prior to the main survey. The results show that the average monthly. WTP for LTC provided in home and residential setting is 18,192Won and 19,293Won, respectively. In the case of home care, WTP goes higher depending on reliability of LTC insurance policy and need for LTC insurance, as well as marital status, education and average monthly income. On the contrary, WTP is conversely affected by higher age and higher bids. In the case of institutional care, the factors affecting WTP are similar to those of home care, except age. This study followed NOAA's suggestions generally and the value derived through survey could be reliable. However, there can be the least bias in the process of survey because the CVM should be used under the supposed circumstances. Despite those limitations, it can be concluded that the amount the citizens are willing to pay for LTC is high enough to meet the costs needed to provide LTC.

• Environmental and Resource Economics Review
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• v.17 no.3
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• pp.135-166
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• 2008

This paper reports the empirical results of comparing the willingness to pay(WTP) for health risk reductions and the willingness to accept(WTA) for risk increases using experimental market methods in the first time in Korea. Health risks were defined as probabilities of premature death from exposure to one of As, Pb, and THM in tap water. A total of six experimental markets with 15 participants in each experiments were held using 20 repetitive Vickrey second-price sealed-bid auctions. To compare the effects of market experiences, trading a marketed good, candy bar, was introduced before the trading the non-marketed good, drinking water risks. Moreover, an objective risk information was provided after the first 10 trials to incorporate learning processes. Regardless of marketed or non-marketed goods, the mean of WTA exceeded the mean of WTP at the first auction trial. As experimental trials proceeded, the disparity between WTA and WTP for marketed goods disappeared. However results for non-marketed goods were rather mixed to the extent that WTA for health risks from As (relatively high risk leves) were significantly larger than WTP, while there were no significant difference between WTA and WTP for health risks fro Pb and THM (relatively low risk levels). On the other hand, participants seemed to respond in a 'rational' manner to the objective risk information provided, with positive learning effects of market-like experience(especially in the WTA experiments).

• Journal of Korean Society of Rural Planning
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• v.20 no.3
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• pp.101-110
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• 2014

As a rise in national income has resulted in the growth in tourism demand, many studies on developing and managing tourism resources were publicized. In this context, this study was conducted to analyze the demand and willingness to pay(WTP) using contingent valuation method for agricultural experience of Daegu Urban Agriculture Park and to suggest a proper participation fee. The survey targeting Daegu citizens was performed, and we obtained 346 valid samples. We carried out the logistic analysis and figured out that sex, age, education and alienation area for urban agriculture affected to probability of agricultural experience participation. As the result of estimating willingness to pay(WTP), the measured range with this samples was from 6,052 to 16,436won. Finally, we also attained 25,000won as the proper participation fee which enables maximum revenue by conducting the scenario analysis. These findings are important in setting up the construction plan and pricing the appropriate participation fee for Daegu Urban Agriculture Park.

• Environmental and Resource Economics Review
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• v.20 no.4
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• pp.797-826
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• 2011

This study analyzed whether a spatial difference exists in the willingness to pay(WTP) for renewable electricity, by applying the contingent valuation method(CVM). Considering renewable portfolio standards(RPS) as the hypothetical market, we asked WTP in the form of the monthly electricity bills for using renewable electricity; the respondents were people living in Seoul, Ulsan, JeollaNamdo, and Gangwondo. Our empirical results showed that the mean WTP of Gangwondo was the highest, and that of JeollaNamdo, the lowest. The hypothesis that the WTP of the entire sample would not differ from that of the individual regions was rejected. Hence, a spatial difference probably exists in the WTP for electricity from renewable energy. Further, we attributed the spatial differences in WTP to the experience of those staying near the renewable energy facility and the acceptability of the facility.

• Korean Management Science Review
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• v.25 no.2
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• pp.43-55
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• 2008

Contingent valuation method(hereafter CVM) is generally believed to be one of the most popular methods used for quantifying the value of non-market goods or services particularly by asking respondents of willingness to pay. This study deals with how to use CVM in calculating the value of mobile telephone service by suggesting methodology of estimation and eliminating biases. This study represents an attempt to estimate the WTP(Willingness To Pay) of the mobile telephone service using the face-to-face interview which is the qualitative technique is used. In this study, by using the single bound dichotomous choice model(SBDC) in order to analyze the valuation of mobile telephone service, WTP was estimated. Also we analyze the factors to pay for mobile service in which it becomes the important factor of demanding services. We used logit model. In order to provide robust estimates of WTP, we have used the Method of Montecarlo Simulation. Consequently, consumers showed that WTP about the mobile communications service is generally high. And it could know that the WTP will fell down as the specialized knowledge about the mobile communications frequency was high. It will be able to become the important part to not only the business carrier but also the policy maker to estimate the economic value of mobile telephone service.

• Asia-Pacific Journal of Business Venturing and Entrepreneurship
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• v.11 no.2
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• pp.157-165
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• 2016

To provide the baseline for pricing, this paper proposes pricing-by-rating (PBR) as pricing model at micro-foundations level that can work as the baseline for all pricing models as well as an assessment criterion of business model in all circumstances. It sets up firstly WTP (willingness to pay/purchase) model from explicit needs and develops PBR based on the ordinal scale of the difference between the WTP and the WTS (willingness to supply/sell) by comparing individually the corresponding element/component of a firm's actual marketing mix 4P with that of the best SPEC (solution, price indicator by WTP, encouragement, channel) as an ideal 4P a customer expects and also by comparing the interaction between the 4P and the best SPEC as a whole collectively. And through illustrations it shows its applicability to evaluating business model in practice and finally asserts that PBR works as the baseline for pricing policy and as a criterion of business model evaluation in any circumstances.

• Journal of Energy Engineering
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• v.22 no.2
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• pp.141-147
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• 2013

Electricity is a basis for human existence. This paper attempts to analyze the households' willingness to pay (WTP) for the residential electricity use. The WTP for the residential electricity use can be defined as the sum of actual price of and additional WTP for it. The former is easily observed in the market, but the second is not observed and thus should be obtained through a WTP survey of households. To this end, this study conducted a survey of randomly selected 1,000 households in Korea in November 2010. The results indicate that the mean additional WTP for the residential electricity use was estimated to be KRW 11.24 per kWh. Given that the average price of residential electricity was KRW 98.07 per kWh at the time of the survey, the economic benefit from the residential electricity use was computed as KRW 109.31 per kWh. This information can be compared with the cost involved in the supply of one kWh of residential electricity.

• Korean Journal of Organic Agriculture
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• v.24 no.2
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• pp.169-188
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• 2016

The purpose of this study is to analyze willingness to pay (WTP) for organic agricultural products. To accomplish the objective of the study, a consumer survey was conducted. Based on the pilot survey results, parametric survival model was used to analyze the WTP for organic products. The estimation results showed that the WTP for organic agricultural products is 1.4-fold when compared with the conventional products, which is lower than the current price by about 30 percent. The analytical results also showed that such variables as gender, recognitions for organic agricultural products, and consumers' income have very significant effects on the WTP, and that there are no differences among WTPs by consumption goals. Based on major findings, the most effective countermeasure was suggested for expanding of organic food consumption through the premium reduction of organic products. Reducing the costs of production and distribution, supporting farmers' income by direct payment system were presented. Furthermore, it is needed to allocate more budget for promoting the consumption and distribution of organic agricultural products, and for enhancing conservation of agricultural environment.