Willingness to pay and price evaluation of assisted living residences in Thailand

Thailand has become an aging society and would be a complete-aged society in a few years. Elderly population in Thailand has been increased according to lower fertility rate, lower birth rate, and longer life expectancy at birth of Thai population. In addition, Thai family size are smaller and Thai women who play important role as a main caregiver are more likely to be educated, be single and be in the labor market instead of being formally unemployed, so, a number of familial caregivers become inadequate and residential Long-term Care (LTC) institution for elderly become more important. Assisted Living Residences (ALs) are taken into account for residential LTC institutions and mainly aim to maintain or improve life satisfaction by encouraging Quality of Life (QOL) and well-being of residents. The purpose of this study is to determine price of ALs and observe the preference of ALs, so, we conduct Willingness to Pay (WTP) survey to estimate how people are willing to pay for ALs in Thailand. The double bounded WTP questions with three attributes related to QOL are conducted and the data is collected from two groups of respondents (Generation Y& Z, Baby boomers & Generation X). Based on Theory of consumer’s choice and Random Utility Theory (RUT), the utility from choosing option is function of an option’s price, respondents’ preference for attributes, respondents’ characteristics, and an error term. Then, WTP could represent individual’s preference towards each ALs service (attitude). The findings from random logit model show that Baby boomers & Generation X respondents significantly have higher WTP than younger group for based case. It is interesting that older group are mostly focus on based case and willing to pay for additional features less than younger group. It is implied that Baby boomers & Generation X concern more about moving into ALs since they are becoming retirement age. While Generation Y & Z do not want to live in ALs reflecting from negative sign of their WTP, but if they have to inevitably live in ALs, they would pay more for additional features such as extended medical services, dinner added, and private room.