Do preferences to reduce health risks related to air pollution depend on illness type? Evidence from a choice experiment in Beijing, China

Abstract This study elicits preferences for clean air in a fast-developing context with increasing regulatory efforts and widespread adoption of self-protection measures against air pollution. We examine whether willingness to pay (WTP) to reduce mortality and morbidity risk depends on the type of illness caused by the pollution. Three major illnesses attributable to air pollution are examined in a choice experiment in Beijing, China. We find robust evidence, testing for both observed and unobserved preference heterogeneity, that WTP does not vary by illness type, and hence, that WTP for policy purposes should not be differentiated based on illness type. We also find that income, education, gender and other factors related with risk vulnerability well predict self-protection, and that respondents who engage more in self-protection have stronger preferences for public interventions. Our results suggest a value of a statistical life (VSL) and value of a statistical illness (VSI) of RMB 5.54 million (USD 1.58 million) and RMB 0.82 million (USD 0.23 million), which are higher than earlier estimates in China. This imply that for societies with strong economic growth and significant pollution, VSL and VSI are likely to increase rapidly, further strengthening the role of policies on pollution control and public health.