Abstract
CV studies rarely ask willingness to accept (WTA) questions, yet there are a range of environmental projects where there are likely to be potential losers as well as gainers. This paper presents evidence from six biodiversity projects that the inclusion of contingent compensation payments from those respondents who preferred the status quo can substantially reduce net project benefits, even when the proportion of losers is relatively small. A statistical model for estimating the mean welfare measure from dichotomous choice data which allows for both positive WTP, zero WTP, and WTA is described. As many environmental projects are likely to create both gainers and losers, we recommend that CV analysts give serious consideration to the collection and analysis of WTA data otherwise they risk generating biased estimates of project benefits.
| Original language | English |
|---|---|
| Pages (from-to) | 391-410 |
| Number of pages | 19 |
| Journal | Environmental and Resource Economics |
| Volume | 18 |
| Issue number | 4 |
| DOIs | |
| Publication status | Published - 2001 |
Keywords
- biodiversity
- CV
- non-market costs
- willingness to accept
- willingness to pay
- WILLINGNESS
- PAY
Cite this
Modelling the Non-market Environmental Costs and Benefits of Biodiversity Projects Using contingent Valuation. / MacMillan, Douglas Craig; Duff, E.; Elston, D. A.
In: Environmental and Resource Economics, Vol. 18, No. 4, 2001, p. 391-410.Research output: Contribution to journal › Article
}
TY - JOUR
T1 - Modelling the Non-market Environmental Costs and Benefits of Biodiversity Projects Using contingent Valuation
AU - MacMillan, Douglas Craig
AU - Duff, E.
AU - Elston, D. A.
PY - 2001
Y1 - 2001
N2 - CV studies rarely ask willingness to accept (WTA) questions, yet there are a range of environmental projects where there are likely to be potential losers as well as gainers. This paper presents evidence from six biodiversity projects that the inclusion of contingent compensation payments from those respondents who preferred the status quo can substantially reduce net project benefits, even when the proportion of losers is relatively small. A statistical model for estimating the mean welfare measure from dichotomous choice data which allows for both positive WTP, zero WTP, and WTA is described. As many environmental projects are likely to create both gainers and losers, we recommend that CV analysts give serious consideration to the collection and analysis of WTA data otherwise they risk generating biased estimates of project benefits.
AB - CV studies rarely ask willingness to accept (WTA) questions, yet there are a range of environmental projects where there are likely to be potential losers as well as gainers. This paper presents evidence from six biodiversity projects that the inclusion of contingent compensation payments from those respondents who preferred the status quo can substantially reduce net project benefits, even when the proportion of losers is relatively small. A statistical model for estimating the mean welfare measure from dichotomous choice data which allows for both positive WTP, zero WTP, and WTA is described. As many environmental projects are likely to create both gainers and losers, we recommend that CV analysts give serious consideration to the collection and analysis of WTA data otherwise they risk generating biased estimates of project benefits.
KW - biodiversity
KW - CV
KW - non-market costs
KW - willingness to accept
KW - willingness to pay
KW - WILLINGNESS
KW - PAY
U2 - 10.1023/A:1011169413639
DO - 10.1023/A:1011169413639
M3 - Article
VL - 18
SP - 391
EP - 410
JO - Environmental and Resource Economics
JF - Environmental and Resource Economics
SN - 0924-6460
IS - 4
ER -