Solid waste management is becoming a major concern area in Pakistan – having considerable health consequences. According to annual report of Social Policy and Development Centre [SPDC (2016)] 38 per cent population of Pakistan belongs to urban areas whereas remaining 62 per cent population belongs to rural areas, this unbalanced growth of population has affected the delivery of basic social services, solid waste management is among the top. A wide-range of research is needed in order to assess the problem, especially to evaluate people willingness to pay to solve the problem. Pakistan Social and Living Standards Measurement Survey (PSLM) 2013-14, first time has published a module on solid waste collection system in Pakistan. The report takes into account both household and neighborhood collection mechanism. Data shows that 584 households are currently paying average amount of Rs80.24 per month on garbage disposal. Among these, rural households are paying around Rs84.51 per month while on average urban households are currently paying an average amount of Rs79.48 per month – lower than their rural counterpart. Furthermore, data also shows that only 1,799 households are currently paying for collection of solid waste from neighborhood, on average Rs87.77 per month. It is interesting to note that rural households are paying 6.6 per cent more as compare to their urban counterparts. On average rural households are paying Rs92.77 per month as compare to urban households – Rs86.99 per month. The objective of the paper is to estimate the household willingness to manage the solid waste, specifically their willingness to pay for the garbage disposal. To evaluate, Contingent Valuation Approach (CVM); applied and Heckman’s two-step procedure is followed to estimate the household willingness to pay empirically. Heckman’s two step procedure is commonly applied in order to deal with the expected problem of sample selection bias. Results reveal is that region, income, service provider (public or private), education and ages of the primary contributors in a household affects WTP for the disposal of household solid waste and SW disposal from the neighborhood.
