Measuring the economic benefits from the contaminated soil remediation policy in Korea: A contingent valuation study

Soil contamination caused by economic growth through industrialization and urbanization has been progressed in Korea. Soil polluted with heavy metals and chemicals makes significantly negative effects on human and wildlife health. This paper attempts to measure the economic benefits from the contaminated soil remediation policy using a specific case study of Korea. To this end, the contingent valuation (CV) method is employed. A CV national survey of randomly selected 500 households was implemented using person-to-person interviewing in May 2105. To elicit the willingness to pay (WTP), we apply one-and-one-half bound dichotomous choice question format to reduce the potential for response bias and spike model to deal with zero willingness to pay (WTP). The mean WTP for the policy is estimated to be KRW 1,357 (USD 1.2) for next ten years per household per year and statistically significant at the 1% level. Expanding the value to the national population gives us KRW 25.4 billion (USD 22.9 million) per year. We can judge that the Korean public places a significant value and be utilized in assessing the total benefits from the policy.