Economising subsidies for green housing features: a stated preference approach

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Journal Article

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Environmental economics, Green construction, Green consumerism, Sustainability, Willingness to pay


In light of the enormous amounts of energy and resources consumed by housing development and operations, many governments have started recognising the urgent need to promote green or eco-friendly housing with the aim of achieving sustainable development. Apart from regulations, governments can offer incentives to developers to provide green features in their developments by offering subsidies in various forms. However, such subsidisation is often uneconomical. In theory, market forces can lead to green housing provision without any government intervention if the market players are willing to pay extra for the green features of housing. Against this background, this article presents the findings of a study that compared potential homebuyers’ willingness to pay (WTP) for various green housing features based on findings from a structured questionnaire survey in Macau. The housing attributes under investigation included uses of green materials (e.g., sustainable forest products) and construction methods (e.g., prefabrication), energy-efficient technologies (e.g., LED lighting) and water-saving devices (e.g., grey-water recycling systems). Results indicate that the respondents’ WTP was mainly motivated by economic incentives. Green housing attributes that can offer direct financial benefits corresponded to greater WTP. The policy implications of the research findings then follow.

Source Publication

Urbani Izziv

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