Customer Willingness to Pay for Carbon Offsetting in Aviation: A Theory of Planned Behavior Approach

Abstract Willingness to Pay of Customers for Carbon Offsetting Programs in Aviation: Incorporating the Theory of Planned Behavior (TPB) The aviation industry faces growing scrutiny for its environmental impact, particularly its contribution to global carbon emissions. Voluntary Carbon Offsetting (VCO) programs present an opportunity for mitigating aviation’s environmental footprint by allowing passengers to financially compensate for their travel-related emissions. However, participation in such programs remains low, with global uptake rates below 10%. Understanding the psychological, economic, and structural barriers that influence consumer Willingness to Pay (WTP) for carbon offsets is critical for enhancing engagement and effectiveness. This study investigates the factors shaping consumer participation in aviation carbon offset programs, particularly among frequent business travelers in the United States. Using the Theory of Planned Behavior (TPB) as a guiding framework, the research examines how attitudes, subjective norms, and perceived behavioral control (PBC) influence WTP. The study employs a quantitative approach, utilizing survey data collected through Prolific, and applies Tobit regression analysis to assess the determinants of WTP. The findings reveal that attitudes toward carbon offsetting, shaped by environmental concern and perceived personal responsibility, are the strongest predictors of WTP. However, subjective norms (social pressure and peer influence) exhibit limited impact, suggesting that personal beliefs outweigh societal expectations in decision-making. Perceived Behavioral Control (PBC) plays a significant role, with higher financial constraints and lack of transparency acting as key deterrents. This research contributes to both theoretical and practical knowledge by expanding the application of TPB within the aviation sector. It provides actionable insights for airlines, policymakers, and sustainability advocates to improve the design and communication of carbon offset programs. Strategies such as simplified pricing models, employer-sponsored offsets, and transparent project verification could enhance consumer trust and participation. By addressing economic, psychological, and structural barriers, this study supports the broader goal of increasing aviation sustainability through consumer-driven offsetting initiatives. Keywords: Carbon Offsetting, Willingness to Pay (WTP), Aviation Sustainability, Theory of Planned Behavior (TPB), Consumer Behavior, Environmental Psychology.