Willingness-to-pay for Hong Kong country parks in the context of housing shortage : a choice modelling approach

Abstract

The housing and rental prices have been sky-rocketing in Hong Kong for the past two decades. Internationally, Hong Kong housing was ranked as “severely unaffordable”. The excess demand for housing is the root for social phenomenon like the emergence of coffin cubicles. Hong Kong SAR government has proposed a number of ways to increase the land supply for residential use, among which the development of country parks adjacent to the city is arguably the most controversial.

This study aims at investigating the perception of Hong Kong citizens in the context of the competition between the development of residential housing and the conservation of country parks from an economic perspective. Choice Modelling, a stated-preference method, is adopted to elicit the utility among Hong Kong citizens by questionnaire survey. Through contemplating the willingness-to-pay and other related economic measures, this study provides a scope for the debate and can be a potential input for future cost-and-benefit analysis.

In the questionnaire preparation stage, two informal focus group meetings were organized aiming to select the relevant attributes and their corresponding levels for the choice model; determine the appropriate level of information to be displayed in the questionnaire; and collect opinion on the payment vehicle. This study utilizes a new payment vehicle, namely the “Reduction in tax rebate” in the model. The collected data is analyzed by Multinomial Logit Model.

Respondents showed a positive willingness-to-pay for all the attributes, which are “country park area” and “biodiversity” and “housing units”. Lastly, this study ends with some discussions and policy recommendations.