Journal of Environmental Economics and Policy, 2014

This paper uses the interval data model to explore the determinants of uncertainty in two-way payment ladder and in multiple-bounded uncertainty choice surveys. It estimates the uncertainty function that relates the size of the willingness-to-pay range to explanatory variables, where one of them is a proxy of the actual willingness-topay. The combination of the interval data model and the inclusion of the proxy variable present some advantages over the ordinary least square estimations currently used in the literature. In particular, it reduces the risk of the omitted variable bias and it takes into account that the dependent variable is not fully observed.

SSRN Electronic Journal, 2000

The Dichotomous Choice Contingent Valuation Method can be used either in the single or double bound formulation. The former is easier to implement, while the latter is known to be more efficient. We analyse the bias of the ML estimates produced by either model, and the gain in efficiency associated to the double bound model, in different experimental settings. We find that there are no relevant differences in point estimates given by the two models, even for small sample size, and no estimator can be said to be less biased than the other. The greater efficiency of the double bound is confirmed, although differences tend to reduce by 2 increasing the sample size. Provided that a reliable pre-test is conducted, and the sample size is large, use of the single rather than the double bound model is warranted.

Journal of Business & Economic Statistics, 2004

The general aim of a contingent valuation survey is to elicit the willingness to pay (WTP) of respondents for some (public) commodity without a clear market price. This could be a program to protect some environmental resource, or (as in our application) the access to a recreational area of particular interest. Such data have peculiarities like the presence of zero WTP and the fact that observations can be in the form of intervals for WTP, rather than point observations. We propose a Bayesian statistical analysis of WTP as a function of individual characteristics of the respondents which formally incorporates this structure of the data. The zero observations are handled through a probit model, and inference on the positive observations will be conditional on the observed intervals. The model for the positive observations will be of a log-linear form with possibly skewed and fat-tailed error distributions. We consider model uncertainty and pay particular attention to the predictive distribution of WTP, from which we derive expected revenue if a certain entry price were asked. The latter is an important tool for deriving pricing policies.

2005

We examine the impact of uncertainty on contingent valuation responses using (1) a survey of Canadian landowners about willingness to accept compensation for converting cropland to forestry and (2) a survey of Swedish residents about willingness to pay for forest conservation. Five approaches from the literature for incorporating respondent uncertainty are used and compared to the traditional RUM model with assumed certainty. The results indicate that incorporating uncertainty has the potential to increase fit, but could introduce additional variance. While some methods for uncertainty are an improvement over traditional approaches, we caution against systematic judgments about the effect of uncertainty on contingent valuation responses.

Applied Economics, 2000

Land Economics, 1997

Discussion papers are research materials circulated by their authors for purposes of information and discussion. They have not undergone formal peer review or the editorial treatment accorded RFF books and other publications.

2002

In this paper we explore the idea that people only know the value they place on a given environmental change as a range, rather than as a singleton. We use the payment ladder design of contingent valuation, and take as a case study the value of coastal water quality improvements in Scotland. Kaplan-Meier survival curves, Tobit analysis and a modified Turnbull algorithm are used to explore the data. We find that most people state their values as a range, and investigate empirically the determinants of this range. The paper concludes with some thoughts concerning possible links between value ranges, context-dependence and uncertainty.

Through the 1970s and 1980s, contingent valuation CV research progressed steadily: applications increased in number and breadth, results gained a degree of credibility, and welfare evaluations from discrete choice data permitted widespread use of policy referendum formats. Following the Exxon Valdez damage assessments, vigorous challenges to CV were mobilized. Instead of the present preoccupation with standardizing CV methods and constructing Popperian tests of CV generically, a broad-based research program is recommended , including proliferation of methods, mapping the performance characteristics of CV, and combining contingent and observed choice data. q 1998 Elsevier Science B.V.

Northeastern Journal of Agricultural and Resource Economics, 1992

This paper empirically tested the three conditions identified by McConnell for equivalence of the linear utility difference model and the valuation function approach to dichotomous choice contingent valuation. Using a contingent valuation survey for deer hunting in California, two of the three conditions were violated. Even though the models are not simple linear transforms of each other for this survey, estimates of mean willingness to pay and their associated 95% confidence intervals around the mean were quite similar for the valuation methods.

2000

We discuss the interpretation of responses to contingent valuation surveys of environmental benefits. Our examples are drawn from two recent surveys, one assessing damages of US$2.8 billion from the Exxon Valdez oil spill and another assessing damages of A$647 million from proposed mining activity in the Kakadu Conservation Zone of Australia. The first issue is whether the mean or the