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Structurally-consistent estimation of use and nonuse values for landscape-wide environmental change
Institution:1. Land Environment Economics & Policy Institute, Department of Economics, University of Exeter, Exeter, EX4 4PU, UK;2. Centre for Social and Economic Research on the Global Environment, School of Environmental Sciences, University of East Anglia, Norwich, NR4 7TJ, UK;3. University of Siena, Department of Political Science and International, Italy;4. Department of Economics and Management, University of Trento, Via Vigilio Inama, 5, 38122, Trento, Italy;1. Virginia Institute of Marine Science and Texas A&M University, College Station, TX 77843, USA;2. Clark University, 950 Main St., Worcester, MA, 01610, USA;3. Virginia Institute of Marine Science, College of William & Mary, Gloucester Point, VA 23062, USA;4. Monash University, Australia;5. University of Melbourne, Australia;1. School of Environmental and Rural Studies, Pontificia Universidad Javeriana, Colombia;2. Sanford School of Public Policy, Duke University, United States;3. School of Economics and Center for the Study of Security and Drugs (CESED), Universidad de Los Andes, Colombia;1. The World Bank, United States;2. Georgetown University, United States;1. University of Alaska Anchorage, 3211 Providence Drive, Anchorage AK, 99501, United States;2. Yale School of Forestry & Environmental Studies, 120 Kroon Hall, New Haven CT, 06510, United States;3. McGill University, 805 Sherbrooke St West, Canada
Abstract:We address the problem of estimating the use and nonuse value derived from a landscape-wide programme of environmental change. Working in the random utility framework, we develop a structural model that describes both demand for recreational trips to the landscape's quality-differentiated natural areas and preferences over different landscape-wide patterns of environmental quality elicited in a choice experiment. The structural coherence of the model ensures that the parameters of the preference function can be simultaneously estimated from the combination of revealed and stated preference data. We explore the properties of the model in a Monte Carlo experiment and then apply it to a study of preferences for changes in the ecological quality of rivers in northern England. This implementation reveals plausible estimates of the use and nonuse parameters of the model and provides insights into the distance decay in those two different forms of value.
Keywords:Random utility models  Nonuse utility  Structural modelling  Water quality  Recreation  Travel cost model  Choice experiment
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