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.     

Do Contingent Valuation Estimates Pass a “Scope” Test? A Meta-analysis

This paper considers the scope test proposed to judge the internal consistency of contingent valuation estimates. The test is shown to be quite sensitive to the maintained hypotheses required to derive fairly precise expectations for the properties of WTP functions, and, therefore, a different approach may be needed in gauging the reliability of CV. This paper describes an approach that relies on a weight-of-the-evidence criterion and uses meta-analysis to develop a systematic appraisal of what the economic values of changes in amenity resources are. The approach is illustrated for the case of estimating people's willingness to pay for improving (or maintaining) visibility at the national parks.     

A Note on Consistent Estimation of Mean WTP Using a Misspecified Logit Contingent Valuation Model

Monte Carlo evidence has shown that simple, misspecified referendum contingent valuation (CV) models sometimes lead to good estimates of mean willingness to pay (WTP). Empirical studies have found that estimates of mean WTP derived from simple parametric models often differ little from those derived from nonparametric methods. This indicates that simple models can potentially yield WTP estimators that are relatively unbiased. This note shows that very simple logit referendum CV models will estimate mean WTP consistently if the survey bids are drawn randomly from a uniform distribution.     

Contingent valuation of ecotourism development in country parks in the urban shadow

To optimise the use and management of Hong Kong's country parks, ecotourism has recently been promoted by the government and echoed by the leisure sector. Visitors' valuation of ecotourism development hitherto remains scant and could add a new dimension to the knowledge and management base. This study estimated the potential value of ecotourism development using the contingent valuation method (CVM). A total of 613 visitors in three country parks were interviewed. The results showed that the bid amounts and the motives to experience and learn more about nature were significant predictors of willingness-to-pay (WTP). The mean and median WTP were, respectively, HK$101.1 and HK$85.0 annually, varying slightly between parks. The differences were associated with the special ecological and accessibility characteristics of individual parks. The results could justify financial support from the government for ecotourism development and associated nature conservation endeavours and promote the incorporation of natural resource valuation in formulation of public policies in Hong Kong and other developing regions.     

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.     

Three reasons to use annual payments in contingent valuation surveys: Convergent validity,discount rates,and mental accounting

We present three arguments for using ongoing annual payments in contingent valuation (CV) surveys that estimate the benefit of a long-lasting environmental improvement. First, by matching the duration of the payments with the duration of the environmental benefits, survey respondents are spared from performing complicated present value calculations. Second, willingness to pay (WTP) estimates from CV surveys that include ongoing annual payments best match WTP estimates obtained using travel cost surveys. Third, respondents are less likely to face binding mental budget constraints with ongoing annual payments than with a larger one-time payment. In addition, respondents’ discount rates may be estimated by collecting non-hypothetical, individual time preference data as part of the valuation survey.     

Valuing non-market benefits derived from allotments in southeast England: A contingent valuation study

The English derive a wide range of values from allotments, but nearly 35% of allotments have disappeared in the last 20 years. The real value of allotments has probably been underestimated. The contingent valuation method (CVM) was used to give a monetary value to benefits derived from allotments by allotment holders and local residents. The study was conducted in southeast England (Wye and Ashford, Kent and Greater London). A postal survey with open-ended questions was filled in by 124 allotment holders and 74 residents. Respondents were asked to express their maximum willingness to pay for allotments (WTP) and the minimum willingness to accept (WTA) compensation for loss of allotments. The mean annual WTP for keeping allotments of allotment holders were £78.93, £35.64 and £79.43, and for local residents were £41.66, £46.14 and £283.57, in Wye, Ashford and London, respectively. The allotment holders' WTP was strategically more than WTA compensation and they were only willing to pay rent for using allotments, not for retaining them.     

Assessment of the conservation value of Munseom area in Jeju Island,South Korea

The ecosystem of munseom area (MA) in Jeju Island, one of the marine protected areas in South Korea, has been continuously threatened by lack of management and pollution of the surrounding sea area. As a result, the South Korean government is trying to implement the systematic management plan to conserve the marine ecosystem of the MA. This article tries to obtain information about the conservation value of the MA. To this end, this study examines household willingness to pay (WTP) for conserving the MA employing the contingent valuation (CV) approach. A total of 1000 South Korean households were involved in the CV survey using a dichotomous choice question. The mean yearly WTP for the conservation is estimated as KRW 1763 (USD 1.50) per household. The national value expanded from the sample to the population is worth KRW 34.0billion (USD 29.0 million) per year. The results imply that the conservation is supported by South Korean households.     

基于CVM的南昌城市河湖生态服务功能价值评估

条件价值评估法(CVM)是当前可用于确定环境物品非市场的和非使用价值的有效方法.在分析南昌市城市河湖生态环境问题的基础上,采用条件价值评估法,共回收194份单边界二分式CVM有效问卷,研究了南昌城市河湖生态系统服务改善的支付意愿及其经济价值.研究表明:1)南昌市城区河湖生态系统服务改善的平均支付意愿约为105.83元/...     

A satisfactory benefit cost indicator from contingent valuation

Standard economic concepts are used to develop a model of individual behavior when subject to the constraints of the contingent valuation choice context. The model yields refutable consequences that are consistent with previously reported empirical findings, including some that have been thought to be anomalous. The model is used to show that different contingent valuation formats have predictably different performance characteristics. Notably, the Hicksian compensating measures are satisfactory benefit cost indicators when elicited using any one of several formats identified in the text. Of the formats examined, one form of a policy referendum appears to have the most satisfactory characteristics. Overall, we conclude that contingent valuation is a progressing research program.     

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.     

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.     

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.     

基于利益相关方意愿调查的东江流域生态补偿机制探讨

流域生态补偿已经成为解决流域生态环境保护问题、协调流域上下游利益冲突的重要手段之一。以东江流域为例,通过实地问卷调查和条件价值评估法评估流域上下游利益相关方生态补偿意愿,并探讨构建东江流域生态补偿机制。流域生态补偿意愿调查结果表明,流域内居民对东江流域生态环境保护有很高的积极性,对建立流域生态补偿机制有较高的认同度;下游地区城市居民平均支付意愿为332.7-364.5元/（年·户）,上游农民对于林地保护的平均受偿意愿为360.75元/（年·hm^2）;通过回归分析发现,受教育水平、收入、自来水水质对支付意愿影响显著,而受偿意愿受性别和受教育水平影响明显;充分考虑并协调好流域上下游利益相关方的诉求对东江流域生态环境保护和生态补偿机制的建立有着重要的现实意义。     

JEEM and Non-market Valuation: 1974–1998

This paper considers whether the Journal of Environmental Economics and Management (JEEM) has had impact on the development and applications of the methods used to estimate economic values for non-marketed environmental resources. Journal editors control the research dialogue in a discipline and as a result have the potential to influence its scope and direction. At least four areas of research have been influenced by JEEM, the theory and practice of contingent valuation, the use of preference restrictions in valuation, the development and application of corner solution models, and the role of substitution between environmental resources for valuation.     

Improving the contingent valuation method: A psychological perspective

Results of research on the social psychology of human decision making that offer direction for improving the contingent valuation method are reviewed. The paper focuses on the findings of that literature related to (1) limitations of human information processing and judgment-making abilities, (2) the influence of elicitation stimuli and expectations, and (3) quality of decision making in the face of too much or too little stress. Within the context of this literature, specific research directions are recommended that can improve the validity and reliability of the results of contingent valuation studies. More multidisciplinary studies are encouraged.     

The value of information for integrated assessment models of climate change

We estimate the value of information (VOI) for three key parameters of climate integrated assessment models (IAMs): marginal damages at low temperature anomalies, marginal damages at high temperature anomalies, and equilibrium climate sensitivity. Most empirical studies of climate damages have examined temperature anomalies up to 3 °C, while some recent theoretical studies emphasize the risks of “climate catastrophes,” which depend on climate sensitivity and on marginal damages at higher temperature anomalies. We use a new IAM to estimate the VOI for each parameter over a range of assumed levels of study precision based on prior probability distributions calibrated using results from previous studies. We measure the VOI as the maximum fixed fraction of consumption that a social planner would be willing to pay to conduct a new study before setting a carbon tax. Our central results suggest that the VOI is greatest for marginal damages at high temperature anomalies.     

Determinants of the marginal willingness to pay for improved domestic water and irrigation in partially electrified Rwandan villages

Access to water for domestic and irrigation uses remains limited across Sub-Saharan Africa, particularly in rural areas. While the technical feasibility of implementing innovative technologies to improve water supply has been often evaluated, less is known about the drivers that motivate users to pay for obtaining the inherent benefits of improved water supply. In this article, the determinants of the marginal willingness to pay (mWTP) for improved domestic and irrigation water are investigated. For this purpose, a contingent valuation study is performed in rural Rwanda. This study uses survey data from 316 households situated in 8 villages, in which ~20% of the households receive electricity thanks to microgrids powered by solar energy. It is found that the mWTP for improved domestic water supply is influenced by the proportion of children in the household, business ownership, and satisfaction with water quantity and quality. The mWTP for irrigation is determined by respondent education, business ownership and crop area planted. This paper contributes to the literature by allowing a comparison of the determinants of the mWTP for improved domestic water supply to the determinants of the mWTP for irrigation. Another contribution is to examine the mWTP for improved water infrastructure in partially electrified villages. Identifying areas with high marginal benefits from water can guide infrastructure investment and electrification efforts while improving well-being and increasing revenues in rural areas.     

Design of Sequential Experiments for Contingent Valuation Studies

Sequential experimentation is recommended as an alternative to the usual one- or two-shot approach to contingent valuation surveys. The sequential C-optimal approach is introduced and developed, and it is compared to the established parametric and non-parametric sequential procedures. It is shown to be an improvement in terms of statistical precision in a finite sample, over the standard sequential procedures.     

Testing the Reliability of the Benefit Function Transfer Approach

This article presents an experiment designed to test the reliability of the benefit function transfer approach using contingent valuation methods. The experiment uses data collected from anglers surveyed across eight contiguous Texas Gulf Coast bay regions over three distinct time periods. Results indicate that the benefit function transfer approach tends to over-estimate benefits, implying that, at least for the case of recreational saltwater fishing in Texas, the benefit function transfer approach is not reliable.