Willingness to Pay of Air Passengers for Carbon-Offset

An important source of anthropogenic greenhouse gas (GHG) emissions is the air transport sector, which accounts for approximately 2% of global GHG emissions. Therefore, reducing GHG emissions from aircrafts has become a major challenge for transportation authorities worldwide. In recent years, much research has focused on tax ideas related to the CO2 emissions produced by air transport, such as the voluntary carbon offset (VCO). This study investigates the willingness of economy class air passengers to pay to compensate for the CO2 emissions produced during their journeys from Taiwan to Hong Kong. Together with the Spike model, a framework known as the contingent valuation (CV) method offers a way to investigate how much the air passenger would be willing to pay to offset a journey’s airplane-generated CO2 emissions. The Spike model was applied to address the problem of zero willingness to pay (WTP). The results obtained in this study are consistent with the results found in previous studies and therefore can provide valuable insights into pricing strategies for airlines.