Willingness to Pay for Silence in Mumbai City

Noise is one of the major local disturbances associated with road traffic. Despite its major importance in the urban environment, the problem of noise has received little attention from environmental economists. In this paper we estimate the willingness to pay for silence for a noise reduction program in Mumbai city. The chosen technique is contingent valuation method. The main objective of this paper is to study different social and economic factors affecting peoples' willingness to pay (WTP) and their attitudes toward the noise reduction programme in Mumbai. Through our estimations we have found, that Mumbai household is willing to pay approximately 287.46 per month to reduce noise levels. I. Introduction Noise, which continues to be one of the main environmental problems facing India, is gaining its importance as a result of the rise in noise levels that comes about with increasing economic activity. Noise is something to which we are exposed throughout life. It is exposure to levels above 40 dB (A) that begins to influence our well being, while levels above 60 dB (A) are considered detrimental to our health. (1) Excessive levels of noise have both physiological, and psychological consequences. The physiological effects include, for example, hearing impairment, disturbed sleep, high blood pressure, stomach ulcers and other digestive disorders. Among the psychological effects we can also mention greater levels of anxiety, irritability and nervousness; it also influences social behaviour and cognitive development. (2) Exposure to aircraft noise and road traffic noise can impact on certain aspects of children"s episodic memory. The World Health Organization guidelines say that for a good sleep, sound level should not exceed 30 dB (A) for continuous background noise, and 45 dB (A) for individual noise events. (3) Monetary valuation of the external costs is also necessary in order to determine optimal environmental taxes on road traffic, rail traffic and air traffic. Noise is a major environmental effect of traffic. (4) According to report almost 45% of the people, have been estimated to suffer from noise levels considered by scientists and health experts to be unacceptable, that is levels where most people become annoyed and sleep is disturbed, and where adverse health effects are to be feared. An additional many of the people are living in so-called "grey areas" where the noise level cause serious annoyance during the daytime. A wide variety of studies have examined the question of the external cost of transport noise to the society. The estimates range from 0.2% to 2% of GDP. (5) Noise is therefore economically important and it stands to a reason that noise should be part of any ex- ante evaluation of major infrastructural projects. An ex-ante evaluation is often carried out in the form of cost - benefit analysis (CBA). In a CBA, as many as possible relevant economic, ecological and social impacts are assessed and monetised. (6) During the last few decades, much research has been done to develop monetisation methods for environmental effects as there is a consensus that environmental effects should be included in the appraisal, but no consensus as to how. (7) II. Objective of the study 1. To determine the willingness to pay for silence by using contingent valuation method. 2. To study different social and economic factors affecting peoples" willingness to pay and their attitudes towards noise reduction in Mumbai city. 3. To find out the monetary valuation of the noise in order to determine optimal environmental taxes on road traffic.