Demand for environmental policies to improve health: Evaluating community-level policy scenarios

Using a national survey and a discrete choice experiment format, we estimate demand for environmental polices to improve health. We use a richly detailed community-level approach that describes illnesses avoided, premature deaths avoided, policy duration, and the affected population size. We allow preferences for policy attributes to vary systematically with the scenario design, with the source of risk and type of health threat, and with respondent characteristics. Using a willingness to pay (WTP) framework similar to that used for studies of individual risk, we find that omission of illness information leads to an upward bias in estimates of the value of avoided premature deaths and that individuals view avoided deaths and avoided illnesses as substitutes. We also find evidence of strongly diminishing marginal utility in policy scope. Differences in marginal WTP from different sources of risk or types of illness appear very small relative to differences associated with respondent characteristics and/or perceptions. Self-interest strongly dominates altruistic considerations.     

How wrong can you be? Implications of incorrect utility function specification for welfare measurement in choice experiments

Despite the vital role of the utility function in welfare measurement, the implications of working with incorrect utility specifications have been largely neglected in the choice experiments literature. This paper addresses the importance of specification with a special emphasis on the effects of mistaken assumptions about the marginal utility of income. Monte Carlo experiments were conducted using different functional forms of utility to generate simulated choices. Multi-Nomial Logit and Mixed Logit models were then estimated on these choices under correct and incorrect assumptions about the true, underlying utility function. Estimated willingness to pay measures from these choice modeling results are then compared with the equivalent measures directly calculated from the true utility specifications. Results show that for the parameter values and functional forms considered, a continuous-quadratic or a discrete-linear attribute specification is a good option regardless of the true effects the attribute has on utility. We also find that mistaken assumptions about preferences over costs magnify attribute mis-specification effects.     

An integrated model of regional and local residential sorting with application to air quality

We examine the interconnectedness of demand for regionally and locally varying public goods using a residential sorting model. We propose a version of the model that describes household choices at the city (MSA) level and, conditional on city, the neighborhood (census tract) level. We use a two-stage budgeting argument to develop an empirically feasible sorting model that allows us to estimate preferences for regionally varying air quality while accounting for sorting at the local level. Our conceptual and empirical approach nests previous sorting models as special cases, allowing us to assess the importance of accounting for multiple spatial scales in our predictions for the cost of air pollution. Furthermore our preferred specification connects the city and neighborhood sorting margins to the upper and lower elements of a nested logit model, thereby establishing a useful correspondence between two stage budgeting and nested logit estimation. Empirically we find that estimates from a conventional model of sorting across MSAs imply a smaller marginal willingness to pay for air quality than estimates from our proposed model. We discuss how the difference is attributable in part to the omitted variable problems arising when tract level sorting is ignored.     

What floats your boat? Preference revelation from lotteries over complex goods

We examine a type of lottery used to distribute some publicly held resource access rights. The lottery provides participants with the opportunity to choose among a set of simple gambles over multi-attribute goods. Participant choices result in an endogenous distribution of success rates over gambles that reflects tradeoffs between the relative desirability of the available goods and the probability of winning. When lottery winnings are multi-attribute goods, lottery outcomes provide sufficient information to estimate hedonic prices, marginal utility, and marginal rates of substitution among attributes. We develop a model for characterizing preferences from this information set. We apply our model to Idaho?s Four Rivers Whitewater Recreation Lottery, which allows applicants to apply for one permit among a large set of alternative river/day combinations that provide varying river and weather characteristics. This lottery structure shows promise as a foundation for economic experiments for preference revelation.     

Comparative tests of reproductive skew in male primates: the roles of demographic factors and incomplete control

Reproductive skew models have been proposed as a unifying framework for understanding animal social systems, but few studies have investigated reproductive skew in a broad evolutionary context. We compiled data on the distribution of mating among males for 31 species of primates and calculated skew indices for each study. We analyzed the determinants of mating skew with phylogenetic comparative methods to investigate two models from reproductive skew theory, the concession model and the tug-of-war model. Mating skew decreased as the number of males increased in multimale groups, suggesting that monopolization of females becomes more difficult when there are more rivals, and therefore supporting the tug-of-war model. We predicted that single males are unable to monopolize receptive females as overlap in female receptivity increases (estrous synchrony) and, as a result, that mating skew decreases. However, we did not find any evidence for a link between female estrous synchrony and male mating skew. Finally, the concession model predicts high skew in male philopatric species relative to species in which males disperse, yet our measures of mating skew showed no significant associations with qualitative scores of male dispersal. More definitive tests of the concession model will require more quantitative measures of relatedness, which are presently unavailable for most primate species in our study. Overall, our results provide support for the tug-of-war model in primates, and the approach developed here can be applied to study comparative patterns of skew in other biological systems.Electronic supplementary material Supplementary material is available in the online version of this article at and is accessible to authorized users.     

Amenity changes,property values,and hedonic prices in a closed city

The effects of changes in amenity levels on the bid prices for land and on the marginal worth of an amenity are examined. The vehicle for analysis is a closed-city urban spatial model containing an explicit utility function and explicitly specified, spatial distributions of amenities. Issues addressed include the behavior of bid price (and property value) schedules in response to amenity changes; the impact of such changes on the utility of renters, under conditions of both identical and disparate tastes; the effect of amenity changes on the amenity's schedule of marginal worth; and the relation of such a schedule in a closed city to that in an open city.     

Uncovering context-induced status quo effects in choice experiments

In this study five design dimensions are varied systematically investigating context-induced status quo effects in choice experiments. Additionally, two structural complexity measures, entropy and the number of attribute level changes, are used to capture status quo effects from the similarity between alternatives and the number of trade-offs. A crucial finding is that the frequency of status quo choices is negatively associated with the number of alternatives indicating preference matching effects. By contrast, the probability of choosing the status quo increases with a higher number of choice tasks, a wider level range, and the similarity between alternatives. Status quo choices are further affected by the current environmental situation perceived by respondents. We also find that marginal and non-marginal welfare estimates are significantly affected by the choice design. One key finding is that the most used choice task format in environmental economics, i.e., two hypothetical and a status quo alternative, is likely to increase the propensity to choose the status quo option.     

Some Welfare Effects of Emission Allowance Trading in a Twice-Regulated Industry

The 1990 Clean Air Act Amendments establish a national market in emission allowances to dramatically reduce SO₂, emissions from electric utilities, who already face economic regulation. Regulatory treatment of allowances will affect the new market. We present simulation results for a simple industry in which two electric utilities face a common Averch-Johnson regulatory constraint and an emissions constraint. In this model the performance of the allowance market depends importantly upon the rate-making treatment of compliance assets by utility regulators. Compared to a command and control scheme, the allowance market substantially reduces the cost of achieving a given environmental standard.     

A mixed Bentham–Rawls criterion for intergenerational equity: Theory and implications

This paper proposes a welfare criterion that balances the need for development and the concern for the least advantaged generations, and explores its implications. This criterion, called the mixed Bentham–Rawls criterion, moderates the effect of discounting, yet permits some degree of intertemporal trade-off. It is a weighted average of two terms: (a) the sum of discounted utilities and (b) the utility level of the least advantaged generation. We derive necessary conditions to characterize growth paths that satisfy our criterion, and show that in some models with familiar dynamic specifications, an optimal path exists and displays appealing characteristics.     

State versus private sector provision of water services in Armenia

Despite increasing advocacy and adaptation of public-private model of water governance worldwide since the 1990s, today only 5% of the world??s population is served by water utilities with private involvement. The present article examines the experience of the water sector in Armenia with private sector participation. The study describes the process of the introduction of public-private partnerships in the water sector and focuses on analyzing the impact of privatization on water utility performance. The analysis employs the partial indicator method for evaluating the impacts in relation to operational, finance, and environmental performance, done by drawing on the database for the five water companies in Armenia. The empirical evidence shows that private participation in general led to improved overall performance. In particular, private involvement resulted in increased operational efficiency in terms of labor productivity, water metering, continuity of service, and revenue collection efficiency. There were mixed improvements in the operating cost coverage ratio. As for environmental performance, there were gains in the reduction of residential water consumption, accompanied, however, by an increase in nonrevenue water.     

The demand for site-specific recreational activities: A characteristics approach

A model of constrained utility maximizing behavior is developed to explain how a representative individual allocates his ski days among alternative sites. The physical characteristics of the ski areas and the individual's skiing ability are explicit arguments in the utility function; the budget allocation is given along with the parametric costs to ski (including travel costs, entrance fees, equipment costs, and the opportunity cost of his time). Shares (a site's share being the proportion of ski days that the individual spends at that site) are derived and assumed multinomially distributed, a stochastic specification which maintains the inherent properties of the shares. Maximum likelihood estimation confirms the basic hypothesis that costs, ability, and characteristics all are important determinants of the sites' shares. The model explains a large proportion of the skier's allocation of ski days. A multinomial logit model of skier behavior is also developed and maximum likelihood estimates of its parameters are obtained. Examination of the summary statistics from my model and the logit model indicates that my model predicts the skier's choice of sites better than the logit model.     

Wildfire smoke and health impacts: A closer look at fire attributes and their marginal effects

Existing studies on the economic impact of wildfire smoke have focused on single fire events or entire seasons without considering the marginal effect of daily fire progression on downwind communities. Neither approach allows for an examination of the impact of even the most basic fire attributes, such as distance and fuel type, on air quality and health outcomes. Improved knowledge of these effects can provide important guidance for efficient wildfire management strategies. This study aims to bridge this gap using detailed information on 24 large-scale wildfires that sent smoke plumes to the Reno/Sparks area of Northern Nevada over a 4-year period. We relate the daily acreage burned by these fires to daily data on air pollutants and local hospital admissions. Using information on medical expenses, we compute the per-acre health cost of wildfires of different attributes. We find that patient counts can be causally linked to fires as far as 200–300 miles from the impact area. As expected, the marginal impact per acre burned generally diminishes with distance and for fires with lighter fuel loads. Our results also highlight the importance of allowing for temporal lags between fire occurrence and pollutant levels.     

Ranked set sample design for environmental investigations

Ranked set sampling can provide an efficient basis for estimating parameters of environmental variables, particularly when sampling costs are intrinsically high. Various ranked set estimators are considered for the population mean and contrasted in terms of their efficiencies and useful- ness, with special concern for sample design considerations. Specifically, we consider the effects of the form of the underlying random variable, optimisation of efficiency and how to allocate sampling effort for best effect (e.g. one large sample or several smaller ones of the same total size). The various prospects are explored for two important positively skew random variables (lognormal and extreme value) and explicit results are given for these cases. Whilst it turns out that the best approach is to use the largest possible single sample and the optimal ranked set best linear estimator (ranked set BLUE), we find some interesting qualitatively different conclusions for the two skew distributions     

Trophy hunters’ willingness to pay for wildlife conservation and community benefits

In the face of fundamental land‐use changes, the potential for trophy hunting to contribute to conservation is increasingly recognized. Trophy hunting can, for example, provide economic incentives to protect wildlife populations and their habitat, but empirical studies on these relationships are few and tend to focus on the effects of benefit‐sharing schemes from an ex post perspective. We investigated the conditions under which trophy hunting could facilitate wildlife conservation in Ethiopia ex ante. We used a choice experiment approach to survey international trophy hunters’ (n = 224) preferences for trips to Ethiopia, here operationalized as trade‐offs between different attributes of a hunting package, as expressed through choices with an associated willingness to pay. Participants expressed strong preferences and, consequently, were willing to pay substantial premiums for hunting trips to areas with abundant nontarget wildlife where domestic livestock was absent and for arrangements that offered benefit sharing with local communities. For example, within the range of percentages considered in the survey, respondents were on average willing to pay an additional $3900 for every 10 percentage points of the revenue being given to local communities. By contrast, respondents were less supportive of hunting revenue being retained by governmental bodies: Willingness to pay decreased by $1900 for every 10 percentage points of the revenue given to government. Hunters’ preferences for such attributes of hunting trips differed depending on the degree to which they declared an interest in Ethiopian culture, nature conservation, or believed Ethiopia to be politically unstable. Overall, respondents thus expressly valued the outcomes of nature conservation activities—the presence of wildlife in hunting areas—and they were willing to pay for them. Our findings highlight the usefulness of insights from choice modeling for the design of wildlife management and conservation policies and suggest that trophy hunting in Ethiopia could generate substantially more financial support for conservation and be more in line with conservation objectives than is currently the case.     

Disentangling the effects of policy and payment consequentiality and risk attitudes on stated preferences

Incentivizing respondents to truthfully reveal their preferences in stated preference surveys requires that they believe their survey responses can influence decisions related to the outcome in question (policy consequentiality) and that they will have to bear their share of the coercive cost if the outcome is implemented (payment consequentiality). We investigate the effects of these two aspects of perceived consequentiality on stated preferences in a field survey concerning renewable energy development in Poland. We find that beliefs in policy and payment consequentiality strengthen the respondents’ interest in having the project implemented. However, policy consequentiality decreases and payment consequentiality increases their sensitivity to the project cost, which, respectively, increases and decreases their willingness-to-pay for the project. We conclude that the two aspects of consequentiality should be addressed separately. Additionally, we inquire the theoretically speculated links between the respondents’ perceptions of policy and payment consequentiality and their risk attitudes, and we find no significant relationship.     

Incentive compatibility tests of choice experiment value elicitation questions

This paper uses laboratory experiments with induced values to address fundamental issues related to the incentive compatibility of choice experiment value elicitation questions. In particular, we compare two- versus three-option choice sets and the effect of using alternative provision rules, including one where the outcome is influenced by both participant and “regulator” votes. We find the overall proportion of choices that are inconsistent with induced preferences is rather low. However, there are more deviations from induced preferences for two-option choice sets, and for alternatives to a simple plurality vote implementation rule. A multinomial probit analysis of choices in tandem with a mixed logit welfare analysis suggests there is a statistically significant but modest degree of bias towards selecting the status quo option.     

Measuring marginal willingness to pay using conjoint analysis and developing benefit transfer functions in various Asian cities

We need a consistent methodology to measure the co-benefits of climate change mitigation across Asian countries. This study chose a strategy of modifying the Japan-specific life-cycle impact assessment method based on endpoint modeling (LIME) for wider application across countries. LIME has two dimensions. First, it is an environmental science that links the cause-and-effect chain. Second, it is an environmental valuation that weighs four endpoint damages in monetary terms through a conjoint analysis that is derived from an Internet-based questionnaire survey. This article describes the modification of the methodology for application of the conjoint analysis to weigh environmental impacts. We approached the investigation as follows. First, we conducted Internet surveys to measure marginal willingness-to-pay (MWTP). We used a sample of 112 respondents in their 20 s to 40 s, divided equally between men and women, in 11 cities across China, India, and Southeast Asia. The results obtained showed clear statistical significance and were comparable across the cities. Second, we attempted to develop functions (called benefit transfer functions) to simplify the measured MWTP in order to apply it across different Asian countries. The functions were derived through a stepwise meta-analytic method, a type of multiple regression analysis whose independent variable was MWTP and dependent variables were attributes of both respondents and surveyed cities. The functions showed that coal consumption and percentage of nature reserve were dependent variables. Then, the MWTPs estimated from the functions were compared with the measured MWTP for transfer error, which is calculated by the absolute value of the difference between the estimated value and the measured value divided by the latter. The transfer error was below 50% in about 90% of the 44 results (a combination of four endpoints and 11 cities), implying that the developed functions were statistically significant.     

Ordering effects and choice set awareness in repeat-response stated preference studies

We present an experiment designed to investigate the presence and nature of ordering effects within repeat-response stated preference (SP) studies. Our experiment takes the form of a large sample, full-factorial, discrete choice SP exercise investigating preferences for tap water quality improvements. Our study simultaneously investigates a variety of different forms of position-dependent and precedent-dependent ordering effect in preferences for attributes and options and in response randomness. We also examine whether advanced disclosure of the choice tasks impacts on the probability of exhibiting ordering effects of those different types. We analyze our data both non-parametrically and parametrically and find robust evidence for ordering effects. We also find that the patterns of order effect in respondents' preferences are significantly changed but not eradicated by the advanced disclosure of choice tasks a finding that offers insights into the choice behaviors underpinning order effects.     

Reproductive seasonality is a poor predictor of receptive synchrony and male reproductive skew among nonhuman primates

Among nonhuman primates, male reproductive skew (i.e., the distribution of reproductive success across males) appears to be affected primarily by receptive synchrony and the number of males per group. These factors have been assumed to depend on reproductive seasonality, with strong seasonality increasing receptive synchrony, which in turn reduces the strength of male monopolization associated with more males and lower skew. Here we tested the importance of reproductive seasonality for 26 populations representing 15 species living in multimale groups. We obtained data from the literature on paternity, number of males per group, receptive synchrony, and three measures of seasonality of reproduction. We analyzed these data using bivariate regressions and hierarchical regression by sets and controlled for the effect of evolutionary relationships using phylogenetic generalized least squares. As expected, alpha male paternity decreased as the number of males per group increased as well as with increasing female receptive synchrony. Reproductive seasonality did not explain variation in reproductive skew over and above the variation explained by synchrony and the number of males. Reproductive seasonality alone only explained a small proportion of the variation in skew, and there was no strong association between reproductive seasonality and synchrony. The effects of receptive synchrony and reproductive seasonality as well as their link were reduced if we excluded captive populations. These results indicate that across primates male reproductive skew is related to the number of competitors in a group and that seasonality does not reliably predict synchrony or male reproductive skew.