Abstract: Based on the Payment Card Contingent Valuation Method, a questionnaire survey was conducted among 554 households in Guangzhou to investigate the willingness to pay (WTP) of urban residents in the lower reaches of the Pearl River for improved river basin environmental quality. The Tobit model was employed to empirically examine the main influencing factors of WTP. The results indicate that the proportion of residents in the lower reaches of the Pearl River with positive WTP was 91.52%, with a mean value of 4.62 CNY per month. Individual heterogeneity among urban residents constitutes a significant influencing factor on the demand for river basin environmental quality. Income level significantly enhances their WTP for clean water sources. Regarding behavioral characteristics, the more frequent the riverside exercise, the greater the demand for environmental quality and consequently the higher the WTP; meanwhile, households already equipped with water purifiers exhibited lower WTP. Furthermore, environmental awareness among urban residents significantly influences their WTP for river basin environmental quality. Further income heterogeneity tests reveal that the WTP of low-income groups is more easily driven by the cognition of environmental value and externalities, whereas that of high-income groups is more significantly affected by payment capacity, alternative protective behaviors such as using water purifiers, and migration expectations. Moderation effect results demonstrate that household water purifiers significantly weaken the impact intensity of residents’ river environmental awareness on their WTP. In the process of improving river basin water environments, it is imperative to enhance the cognition of urban residents in the lower reaches regarding the importance of ecosystems and establish incentive mechanisms for river basin ecosystem protection based on the participation and payment of these downstream residents, thereby comprehensively elevating the level of human welfare in both upstream water source areas and downstream residential areas.

Key words: environmental quality, willingness to pay, heterogeneity, Contingent Valuation Method