Averting expenditure and the cost of pollution

The paper considers the relationship between the willingness to pay for environmental quality and averting expenditures—that is, the costs of measures undertaken in efforts to counteract the consequences of pollution. The models used assume perfect mobility among locations with different levels of environmental quality. The major results are: (1) Averting expenditures are not in general a good measure of willingness to pay; (2) averting expenditures are not always even a lower bound on willingness to pay; (3) even when averting expenditures are a lower bound, the difference between the level of such expenditures and willingness to pay cannot be attributed to the unavertible “aesthetic” consequences of pollution.     

The influencing factors of the WTP for the risk reduction of chemical industry accidents in China

To explore the factors that influence respondents’ willingness to pay (WTP) for the risk reduction of chemical industry accidents, a questionnaire survey combined with contingent valuation and psychometric paradigm methods were conducted in the city of Yancheng, Jiangsu Province, China. Both traditional socioeconomic variables and perceived characteristics of the hazards were considered in this study, and a Tobit model was used to find the factors influencing WTP under three risk reduction scenarios. The results showed that three demographic characteristics, age, gender, and income, significantly affected the WTP for chemical risk reduction. In addition, three extracted public risk perception factors, effect, knowledge, and trust, also strongly affected the WTP. The mean WTP value increased as the magnitude of the risk reduction increased. The number of factors influencing the WTP decreased as the reduction level improved, and only the effect factor had a significant influence on the WTP for a higher level (80%) of risk reduction. The cost for chemical safety management of Yancheng was calculated, and the optimized risk reduction level was determined. These findings can assist governments and policy makers to formulate suitable strategies for risk control, to reach target groups of people to develop effective communication, and to provide specific references for the best investment for the security of local residents.     

Hedonic housing prices and the demand for clean air

This paper investigates the methodological problems associated with the use of housing market data to measure the willingness to pay for clean air. With the use of a hedonic housing price model and data for the Boston metropolitan area, quantitative estimates of the willingness to pay for air quality improvements are generated. Marginal air pollution damages (as revealed in the housing market) are found to increase with the level of air pollution and with household income. The results are relatively sensitive to the specification of the hedonic housing price equation, but insensitive to the specification of the air quality demand equation.     

Attitudes towards risk and the optimal exploitation of an exhaustible resource

The exploitation of a nonrenewable natural resource, such as petroleum or mineral ores, is analyzed in a stochastic framework with price uncertainty. The market setting may be either monopolistic or competitive. We demonstrate that the rate of extraction varies directly with the resource owner's willingness to accept risk. Rish-preferring owners use the resource more rapidly than risk-neutral owners, who in turn deplete the resource more rapidly than risk-averse owners. It is also seen that the usual practice of increasing the discount rate to account for risk induces a more rapid rate of resource use, when in fact a slower rate of depletion is desired.     

The Relationship between the Income Elasticities of Demand and Willingness to Pay

The relationship between income and willingness to pay for collectively provided public/environmental goods is investigated. We show that while the income elasticity of willingness to pay and the ordinary income elasticity of demand are related, knowledge of one is insufficient to determine the magnitude or even the sign of the other. The income elasticity of willingness to pay is influenced by additional factors which are generally unobservable. Examples are provided to illustrate the degree to which the two income elasticities may diverge. Our results indicate that even when goods are demand luxuries they may or may not have income elasticities of willingness to pay which are greater than one.     

Valuing high-seas ecosystem conservation

The high seas provide a variety of ecosystem services that benefit society. There have, however, been few attempts to quantify the human welfare impacts of changes to the delivery of these benefits. We assessed the values of several key ecosystem service benefits derived from protecting ecosystems in the high seas of the Flemish Cap through choice experiments conducted in Canada, Norway, and Scotland. Rather than solely eliciting public willingness to pay, we also explored the determinants of variance in the estimates of willingness to pay. We aimed to determine how much respondents were willing to pay for high-seas ecosystems conservation, which factors influence individuals’ willingness to pay, and whether individuals in Canada had a higher willingness to pay relative to those living in Norway and Scotland. This latter point captures distance-decay effects. On average, the public placed positive value on conserving high-seas ecosystems and on developing economic activities related to the exploitation and exploration of marine resources, despite a lack of awareness and familiarity with these environments. Distance-decay effects on willingness to pay were not clear. Scots had the highest willingness to pay and the Norwegians the lowest willingness to pay for all attributes, with the only exception being willingness to pay for a large increase in new jobs, in which case Canadians’ willingness to pay was higher than Scots’. The public's willingness to pay was influenced by sociodemographic characteristics and their perceptions of high-seas ecosystems. Our results provide evidence of the impacts of high-seas governance on human welfare and that improved governance could increase the value people place on high-seas ecosystems and the services they produce.     

State subsidies induce gray jays to accept greater danger: an ecologically rational response?

Models of strictly rational choice assume that decision-makers evaluate options on relevant dimensions, assign fixed values to options, and then make consistent choices based on these values. If so, recent experience would have no impact on preference. But, recent events change an animal’s state, and preference may change accordingly. We explore how state affects willingness to accept greater danger to obtain larger food rewards. We tested how a supplement in state (hoard size) impacts this willingness in gray jays (Perisoreus canadensis). When subsidized, most of the subjects increased their willingness to trade danger for food. Why would they become less cautious when their hoard was increased? Superficially, it might seem prudent to play it safer in response to a subsidy. But imagining fitness as a sigmoid function of state (hoard size) provides a tentative explanation for our counterintuitive finding. Above a threshold hoard size, a subsidy should weaken the willingness to accept extra danger. Incremental increases in state in the deceleratory phase yield smaller fitness gains, so it would pay to increase emphasis on safety after receiving a subsidy. But below this threshold, incremental increases in state in the acceleratory phase yield bigger fitness gains, and so it would pay to decrease emphasis on safety after receiving a subsidy. Most of our subjects’ choice behavior was, thus, plausibly consistent with the possibility that effective hoard size is considerably smaller than the total number of items stored. We speculate that this response may reflect an ecologically rational compensation for the inevitable loss of hoards via theft and rot.     

Semi-nonparametric Distribution-Free Dichotomous Choice Contingent Valuation

We apply a semi-nonparametric distribution-free estimator for binary discrete response data to the estimation of a dichotomous choice contingent valuation model. Using this estimator, mean and median compensating and equivalent variation can be consistently estimated without making nontheoretically motivated assumptions on consumer' preferences. The approach is illustrated using a contingent valuation survey of willingness to pay for reduction of risk of premature death due to exposure to hazardous waste. We find that a conventional parametric estimator and the proposed estimator give similar estimates of unconditional WTP, but that conditional on explanatory variables the estimates are quite different.     

Values and willingness-to-pay for sustainability-certified mobile phones

ABSTRACT

This study investigated whether endorsement of personal values is associated with willingness to pay more for mobile phones with an environmental or social sustainability label. Participants were students in Sweden, Norway and Germany. A self-report inventory was used to measure willingness to pay and the importance attached to values of Schwartz’s circular model. In Sweden and Norway, participants were willing to pay, on average, 18% extra for a mobile phone with labels for environmental or social sustainability. In Germany, the corresponding share was 12%. To strive for self-enhancement values, that is, social status and prestige, as well as control and dominance over people and resources, was associated with a lower willingness to pay for mobile phones with labels for environmental or social sustainability in all three countries. Furthermore, women were willing to pay more than men for mobile phones with both kinds of sustainability labels. In Sweden and Norway, participants were, on average, willing to pay more for a mobile phone with a label for social sustainability compared to a mobile phone with a label for environmental sustainability.     

Public Willingness to Pay for Recovering and Downlisting Threatened and Endangered Marine Species

Abstract: Nonmarket valuation research has produced economic value estimates for a variety of threatened, endangered, and rare species around the world. Although over 40 value estimates exist, it is often difficult to compare values from different studies due to variations in study design, implementation, and modeling specifications. We conducted a stated‐preference choice experiment to estimate the value of recovering or downlisting 8 threatened and endangered marine species in the United States: loggerhead sea turtle (Caretta caretta), leatherback sea turtle (Dermochelys coriacea), North Atlantic right whale (Eubalaena glacialis), North Pacific right whale (Eubalaena japonica), upper Willamette River Chinook salmon (Oncorhynchus tshawytscha), Puget Sound Chinook salmon (Oncorhynchus tshawytscha), Hawaiian monk seals (Monachus schauinslandi), and smalltooth sawfish (Pristis pectinata). In May 2009, we surveyed a random sample of U.S. households. We collected data from 8476 households and estimated willingness to pay for recovering and downlisting the 8 species from these data. Respondents were willing to pay for recovering and downlisting threatened and endangered marine taxa. Willingness‐to‐pay values ranged from $40/household for recovering Puget Sound Chinook salmon to $73/household for recovering the North Pacific right whale. Statistical comparisons among willingness‐to‐pay values suggest that some taxa are more economically valuable than others, which suggests that the U.S. public's willingness to pay for recovery may vary by species.     

Turbulence and phytoplankton diversity: A general model of the “paradox of plankton”

The principle of “competitive exclusion” predicts that no two species can occupy the same ecological niche at the same time and place (Hardin, 1960). Hutchinson (1953, 1961) suggested that the vast diversity of phytoplankton observed in many aquatic environments presents an apparent contradiction to this principle. Since all phytoplankton compete for the same basic resources, and since the euphotic zones of most natural waters are relatively homogeneous, such coexisting plankters appear to be simultaneously occupying the same niche. In this paper we present simulation results from a mathematical model wherein we examine the hypothesis that physical turbulence in an aquatic system can mollify interactive pressures between plankton populations and allow coexistence of species competing for the same resources. Using Bella's (1972) highly simplified model as a point of departure, we develop a new model, explicitly incorporating gross physiological mechanisms, to investigate the effects of both advective and turbulent components of water movement on the growth of three competing phytoplankton species. We observed that, in the absence of water motion, no two species were able to coexist, while under the hypothetical conditions of advection without turbulence (laminar flow), just two species were able to occur contemporaneously. Coexistence of all three species was achieved only with the addition of a random turbulent component to the model's hydrodynamic function. Moreover, this general coexistence was observed only when the major turbulent frequency approached the turnover rate of phytoplankton populations. We suggest that there is a limited region of periodicities and magnitudes for hydrodynamic energy in which phytoplankton can coexist, and that most natural aquatic environments fall within this region. We further speculate that, in general, the coupling of physical and biological processes in nature may be influenced by the relative frequency characteristics of those processes.     

Statistical models of health risk due to microbial contamination of foods

Between 6 million and 33 million cases of food-related illness are estimated to occur in the United States each year, with about 5000 episodes resulting in death. Growing concerns about the safety of food prompted the National Food Safety Initiative of 1997, the goal of which is to reduce the incidence of illness caused by food-borne pathogens. A key component of the food safety initiative is the improvement of farm-to-table risk assessment capabilities, including the development of improved dose-response models for estimating risk. When sufficient data are available, allowable contamination levels of specific micro-organisms in food are established using dose-response models to predict risk at very low doses based on experimental data at much higher doses. This necessitates having reliable models for setting allowable exposures to food-borne pathogens. While only limited data on relatively few micro-organisms that occur in food are available at present for dose-response modeling and risk estimation, still none of the two-parameter models proposed so far, including the popular Beta-Poisson (BP) model, appears to be completely satisfactory for describing and fitting all of the present data (Holcomb et al., 1999). The Weibull–Gamma (WG) model is the only three-parameter model that has been proposed to date. In this paper, new competitive three-parameter models are derived, using a formulation that can be parameterized to represent statistical variation with respect to the dose of micro-organism received by the host and the hosts susceptibility to infection. Parameters of the models are estimated using the maximum likelihood method. Experimental data on several common microbial contaminants in food are used to illustrate the methodology.     

居民为改善北京市大气环境质量的支付意愿研究

用意愿调查价值评估法分析了北京市居民为改善大气环境质量的支付意愿 ,评估大气质量改善的价值 ,并对这一方法在我国的应用进行探讨。结果显示 ,研究范围内的居民为 5年内降低目前大气污染物质浓度的 5 0 %而支付费用的平均支付意愿是 143元 /户·年 (1999年元 ) ,该区域内居民总的支付意愿是 3 .36亿元 /年 (1999年元 ) ,被调查者的家庭收入、教育水平、家庭人口数和年龄等社会经济变量对支付意愿有显著影响。最后 ,对意愿调查价值评估法在我国应用时存在的问题进行了初步探讨     

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.     

Parental altruism and the value of avoiding acute illness: are kids worth more than parents?

A model describing parents’ preferences to relieve their own and their children's acute illnesses is estimated using stated-preference data. Estimated marginal rates of substitution (MRS) between child and parent illness are about two, indicating that parents value children's illness attributes twice as highly as their own. The MRS is larger for younger children, falls toward unity as the child approaches adulthood, and appears to reflect parental altruism rather than parent–child differences in initial health or illness costs. Intra-family allocations may compensate for chronic health impairments. Parents’ willingness to pay to avoid own or child illness increases with income, declines with fertility, increases at a decreasing rate with duration and number of symptoms, and depends on perceived discomfort and activity restrictions. Current methods of assessing morbidity benefits of environmental regulations may understate substantially the value of children's health, particularly in African-American families.     

Social evolution and its correlates in bees of the subgenus Evylaeus (Hymenoptera; Halictidae)

Summary Eleven behavioural characteristics of eight species of the subgenus Evylaeus were analysed using principal components analysis. The first component axis represents social level and explains over forty percent of the total variation in the data. The following characteristics are highly correlated with social level — (i) a reduction in the proportion of males in the first brood, (ii) a reduction in the proportion of workers that mate, (iii) a reduction in the proportion of workers that have developed ovaries, (iv) an increase in the mean number of workers, (v) increased contact between adults and developing brood and (vi) an increase in the size difference between queens and workers. Because these factors appear, in general, to be under the control of the queen it is argued that parental manipulation has been an important component of social evolution in these bees. The number of worker broods and the mechanism of male production are also related to social level but are less important. Nest architecture, nest defense and polygyny seem to be unrelated to social level. Variation in nest architecture may be in response to edaphic features of the substrate. The lack of any relationship between polygyny and social level implies that the semisocial route to eusociality was not the one taken. It is likely that polygyny can only occur where the substrate is suitable for the winter hibernation of sisters in their natal nest. Multivariate methods are useful in determining the relative social level of closely related halictine species.     

A new baseline model for estimating willingness to pay from discrete choice models

We show a substantive problem exists with the widely-used ratio of coefficients approach to calculating willingness to pay (WTP) from discrete choice models. The correctly calculated standard error for WTP using this approach is shown to be undefined. This occurs because the cost parameter's standard error implies some possibility the true parameter value is arbitrarily close to zero. We propose a simple yet elegant way to overcome this problem by reparameterizing the (negative) cost variable's coefficient using an exponential transformation to enforce the theoretically correct positive coefficient. With it the confidence interval for WTP is now finite and well behaved.     

Willingness to Pay for Quality Improvements: Should Revealed and Stated Preference Data Be Combined?

In this article we propose theoretically consistent welfare measurement of use and nonuse values for an improvement in environmental quality with revealed and stated preference data. An analytical model based on the comparative static analysis of the variation function that describes the relationship between recreation demand and dichotomous choice contingent valuation models is estimated. Our results show that revealed and stated data should not be combined under the same assumed preference structure unless the two decisions imply the same change in behavior induced by the quality change. In addition, our results indicate scope effects in willingness to pay measures estimated with stated preference data.     

A criterion validity test of the contingent valuation method: comparing hypothetical and actual voting behavior for a public referendum

This study pursues external validation of contingent valuation by comparing survey results with the voting outcome of a Corvallis, Oregon, referendum to fund a riverfront improvement project through increased property taxes. Survey respondents hypothetically make a voting decision—with no financial consequences—on the upcoming referendum. The survey sample consists of respondents verified to have voted in the election. We use available precinct-level election data to compare the proportion of “yes” survey and referendum votes as well as estimate voting models and mean willingness to pay (WTP) based on the two sets of data. We find that survey responses match the actual voting outcome and WTP estimates based on the two are not statistically different. Contrary to similar studies, our statistical results do not depend on re-coding the majority of “undecided” survey responses to “no.” Furthermore, such a re-coding of responses may be inappropriate for our data set.     

Welfare cost of eutrophication-caused production losses: A case of aquaculture in Lake Kasumigaura

A general model for man's utilization of water resources is presented, in which the linkage between man's production activities and environmental systems is formulated based on Whitcomb's generalized joint production model and Kneese's transfer function. The general model is specified for a particular case of aquaculture in Lake Kasumigaura so as to evaluate in terms of the price data of 1978 the welfare cost of eutrophication-caused production losses under the assumption of horizontal demand curve.