Accounting for the importance of psychological distance in assessing public preferences for air quality improvement policies: an application of the integrated choice and latent variable model

Assessing public preferences for air pollution control is essential to achieving effective air quality improvement, but the internal psychological factors affecting public preferences, especially psychological distance (PD), have only received limited attention. Therefore, this paper explores the role of PD in assessing public preferences for air quality improvement policies. Compared with previous studies that consider psychological factors in the choice model, this study incorporates PD into the choice model as a latent variable by considering both individual responses to measurement questions and socio-economic characteristics in the integrated choice and latent variable model. The results of this study clearly show that PD significantly affects public preferences for air quality improvement policies. Respondents with close PD had obvious preferences for air quality improvement, while those with distant PD were satisfied with the current situation and reluctant to improve it. After considering PD in the analysis, respondents’ willingness to pay for one-unit level change of attributes “heavily polluted days,” “good air days,” “mortality,” and “policy postponement” were respectively 10.3791CNY, 10.9005CNY, 11.0427CNY, 28.3412CNY per year. In addition, the paper also found men and respondents with lower levels of education and higher monthly incomes tended to view air pollution as psychologically distant and thus less willing to improve air quality. It is suggested that policy makers should reduce the PD of air pollution among these people by increasing publicity about the hazards of air pollution. This study not only contributes to the literature on the importance of PD in assessing individual preferences, but also provides constructive guidance for policy makers to assess the public’s acceptability of air quality improvement.