Academic journal article Agricultural and Resource Economics Review

The Effects of Climate Change Information on Charitable Giving for Water Quality Protection: A Field Experiment

Academic journal article Agricultural and Resource Economics Review

The Effects of Climate Change Information on Charitable Giving for Water Quality Protection: A Field Experiment

Article excerpt

Climate change poses the threat of increasing the frequency and severity of extreme weather events, which could compromise the quality of drinking water resources in the United States. Despite overwhelming agreement among climate scientists that global warming, accelerated by human use of fossil fuels, is hastening climate change (International Panel on Climate Change 2014), numerous surveys have shown that 40 percent or more of Americans believe either that humans are not causing the acceleration or that the acceleration is not occurring (Gallup 2015). This lack of public support has discouraged U.S. policymakers at all levels from implementing plans to combat the effects of greenhouse gas emissions and begin the process of adapting to the potential negative consequences of climate change.

Using a field experiment, we examine how messages related to global warming induced climate change, extreme weather events, and decaying infrastructure affect people's willingness to contribute charitable donations for projects meant to improve the quality of drinking water. The experiment evaluates the effect of alternative linguistic framing in treatments involving commonly used phrases related to climate change and infrastructure investment to determine how such messages encourage or discourage the allocation of economic resources to efforts to adapt to these future problems.

Utilities that provide drinking water in the United States and elsewhere around the world face a multitude of challenges ranging from aging infrastructure to rising treatment costs and increasingly stringent regulations. The U.S. Environmental Protection Agency (EPA) reports that a significantly greater percentage of the country's precipitation over the past 25 years has come from intense single-day events, a change that scientists widely attribute to climate change (EPA 2014). At the same time, the American Society of Civil Engineers (ASCE) noted in its 2011 Failure to Act report (ASCE 2011) that the gap in funding needed for capital investments in water infrastructure continues to rise and predicted that it will expand from $54.8 billion in 2010 to $143.7 billion in 2040 (Figure 1). Administrators of utilities that provide drinking water must find ways to pay for much-needed improvements and repairs by increasing rates without seeming unreasonable or extravagant. Thus, gauging customers' responses to requests for rate increases is essential. Numerous stated-preference studies have indicated that income, household size, education, age, employment status, gender, and distance to a water source influence consumers' willingness to pay (WTP) for improved water resources (Moffat, Motlaleng, and Thukuza 2011, Veronesi et al. 2014, Kotchen, Boyle, and Leiserowitz 2013). The Water Research Foundation (2011) noted that information received through previous studies had aided a water utility in prioritizing investments and in developing and strengthening the utility's relationship with its customers.

To date, information on customer preferences and WTP for future investments in water quality has been collected through surveys. For example, the Water Research Foundation used surveys to gauge customers' WTP for proposed investments in infrastructure, water reuse, and renewable energy projects by the Albuquerque Bernalillo County Water Utility Authority in New Mexico (Water Research Foundation 2011). Although the surveys did not address projects specifically associated with water quality, the results are useful for understanding how survey techniques can be used in a utility-specific analysis. The surveys elicited WTP using a hypothetical stated-preference mechanism, which raises concern that respondents might have overstated their WTP because they did not actually purchase the good with their own money at that time (Water Research Foundation 2011).

The terms used in discussions of political issues are critical to public perceptions. For instance, a 2013 Huffington Post poll (Swanson 2013) found that approximately 20 percent of Americans identified themselves as "feminists" while 82 percent believed in social, political, and economic equality for men and women. …

Search by... Author
Show... All Results Primary Sources Peer-reviewed

Oops!

An unknown error has occurred. Please click the button below to reload the page. If the problem persists, please try again in a little while.