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Willingness to pay for protection from storm surge damages under climate change in Halifax Regional Municipality

Withey, Patrick, Sullivan, Deny, Lantz, Van
Journal of environmental management 2019 v.241 pp. 44-52
cities, climate change, contingent valuation, education, floods, gender, income, infrastructure, issues and policy, models, regression analysis, risk, sea level, storms, willingness to pay
Climate change poses risks to coastal cities due to sea-level rise and changes in storm surge. Using the contingent valuation method and payment card format, this paper seeks to estimate residents of Halifax Regional Municipality's willingness to pay (WTP) for protection from flooding impacts from storm surge. The contribution of this study is the application of this method in a previously unstudied region, to understand individuals' perception of risk and WTP to avoid damage, in order to inform policy aimed at protecting against damage due to sea-level rise and storm surge. WTP is estimated without and with the expectation of future climate change, and also for public vs. private goods. Data is analyzed and compared using OLS, Heckman two-step and Tobit Interval regression models. Results suggest that on average, WTP is roughly $12 per month per household over a ten-year period without the expectation of climate change, and roughly $13 per month per household assuming climate change will have negative impacts in the region. Individuals are most often willing to pay to protect against damages to public infrastructure, as well as power outages. Income and education do not play a major role in individuals WTP. Vulnerability to flooding and level of concern related to risky events have a statistically significant impact on WTP in all models, and gender and age have an impact on WTP in some models.