A Contingent Valuation Approach to Household’s Willingness to Pay for Improved Piped Water Access in North Wollo Zone, Ethiopia

Abstract

This study explores the demographic, economic, and infrastructure-related factors influencing households' willingness to pay (WTP) for improved piped water services in the North Wollo Zone, Ethiopia. Both descriptive statistics and econometric models, using the double bounded contingent valuation method (CVM), were applied to assess variations in water access across four woredas: Gidan, Meket, Bugna, and Lasta. The descriptive results show spatial variations in factors such as gender and education across the study areas. In particular, Gidan experiences severe water shortages, combined with low literacy levels and a predominance of male-headed households, creating challenges for inclusive water governance. Econometric analysis further indicates that higher bid prices reduce WTP, reflecting households' budget constraints. At the same time, factors such as large family size, monthly water expenditure, and the age of the household head positively influence WTP. The findings also suggest that even relatively wealthier households face competing financial priorities. The sex of the household head appears to be a significant determinant for WTP, with male-headed households showing a greater willingness to pay for improved services. Overall, the study shows the need for addressing educational disparities and promoting gender inclusivity to strengthen community engagement in water management. It also underscores the need for targeted interventions for larger households and those with lower expenditure, as these groups face unique financial constraints despite their expressed willingness to pay. Finally, investments in sustainable water infrastructure and community engagement are critical, but pricing strategies must ensure both affordability and widespread participation. These insights provide valuable guidance for designing effective, locally tailored water management strategies in the zone.