In the facility siting literature it is noted that one of the problems with the siting of (energy-related) facilities is that the benefits are usually at the regional or national level, whereas the (perceived) costs are local (e.g., concerns about safety, declines in property values). This imbalance in costs and benefits may instigate public opposition to new facilities and environmental technologies. The offering of host community compensation can be used to prevent or resolve siting controversies, according to the facility siting literature. Our own literature review (Ter Mors et al., 2012) showed, however, that there is little empirical research on the effectiveness of compensation, and practically no research on the underlying psychological processes. To fill this gap, we have set up a series of experimental studies on this topic. The results of these studies show that public responses to host community compensation depend on how compensation is framed, the type of compensation offered, and the procedure used in the process of deciding on compensation. Importantly, the studies also reveal that people consider social aspects (e.g., procedural fairness, a party’s trustworthiness) in their evaluations of and responses to host community compensation. The focus on process variables and the finding that, under certain conditions, offering monetary compensation can be effective are relevant contributions to the existing literature.

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