the role of benefit transfer in ecosystem service valuation the demand for timely monetary estimates of the economic value of nonmarket ecosystem goods and services has steadily increased over the last few decades this article describes the use of benefit transfer to generate monetary value estimates of ecosystem services specifically the article provides guidance for conducting such benefit transfers and summarizes advancements in benefit transfer methods databases and analysis tools designed to facilitate its application

integrating methods for ecosystem service assessment and valuation mixed methods or mixed messages a mixed method approach was used to assess and value the ecosystem services derived from the dogger bank an extensive shallow sandbank in the southern north sea three parallel studies were undertaken that 1 identified and quantified where possible how indicators for ecosystem service provision may change according to two future scenarios 2 assessed members of the public s willingness to pay for improvements to a small number of ecosystem services as a consequence of a hypothetical management plan and 3 facilitated a process of deliberation that allowed members of the public to explore the uses of the dogger bank and the conflicts and dilemmas involved in its management each of these studies was designed to answer different and specific research questions and therefore contributes different insights about the ecosystem services delivered by the dogger bank this paper explores what can be gained by bringing these findings together post hoc and the extent to which the different methods are complementary findings suggest that mixed method research brings more understanding than can be gained from the individual approaches alone nevertheless the choice of methods used and how these methods are implemented strongly affects the results obtained

the impact of distressed economies on the eu sovereign market financially distressed economies inside the european union eu are being blamed for producing a general increase in borrowing costs this article analyzes the channels of default risk transmission within the eu countries using the information content in the sovereign credit default swap cds market we proceed in two directions first we test the existence of cross border volatility effects between the central and the peripheral eu countries second we explore the effect of distressed economies on the default and risk premium constituents of sovereign default swaps we show a significant volatility spillover from distressed to central european economic and monetary union emu economies this causality pattern leads to a significant impact on the default swap risk premia on average the risk premium accounts for approximately 42 of central emu spreads and 56 of the spreads for those countries outside of the emu the peripheral risk also affects the default component of central economies although its impact is lower

what have we learned since hotelling s letter a meta analysis abstract this paper reports the results of a meta analysis of the estimates of the price elasticity of demand for recreation sites using the travel cost method by using econometric methods to summarize empirical literature meta analysis assists in identifying research conclusions despite the non experimental nature of most empirical research in economics in this application the results suggest that modeling decisions based on theory as well as those relying on fitting criteria were important influences to the estimated price elasticities across studies

pricing default swaps empirical evidence in this paper we compare market prices of credit default swaps with model prices we show that a simple reduced form model outperforms directly comparing bonds credit spreads to default swap premiums we find that the model yields unbiased premium estimates for default swaps on investment grade issuers but only if we use swap or repo rates as proxy for default free interest rates this indicates that the government curve is no longer seen as the reference default free curve we also show that the model is relatively insensitive to the value of the assumed recovery rate

willingness to pay for land preservation across states and jurisdictional scale implications for benefit transfer in stated preference valuation of farmland preservation respondents are often told that preservation will occur within various jurisdictional scales that is community or state but are not told the specific location of parcels the resultant availability of welfare estimates for different scales and regions provides numerous avenues for benefit transfer this paper provides a systematic assessment of transfer error contrasting different methods for the transfer of farmland preservation values across states and jurisdictional scales results drawn from multistate choice experiments suggest that the choice of across scale versus across state transfer method can have significant implications for transfer validity

the use and abuse of meta analysis in environmental and natural resource economics an assessment motivated by the 2006 report of a work group appointed by the environmental protection agency epa this paper examines the present state of meta analysis in environmental economics and offers recommendations for its future use to this end we summarize and assess 140 meta analyses from 125 published and unpublished studies covering 17 topical categories in environmental and resource economics first we provide several generic meta analysis models as reference points and discuss major estimation issues five econometric issues are identified as part of a complete analysis 1 sample selection criteria 2 basic data summary 3 primary data heterogeneity 4 heteroskedasticity and 5 non independence of multiple observations from primary studies second a tabular summary is presented for the 140 meta analyses with respect to estimation methods third a narrative summary is presented for 19 meta analyses including the three value of statistical life studies examined by the epa work group and one analysis from each of 16 other categories fourth we offer a set of best practice guidelines for future meta analyses in this and other areas of economics last the paper comments on the use of meta analytic methods for benefit transfers of environmental values

ecological economic analysis of wetlands scientific integration for management and policy abstract wetlands all over the world have been lost or are threatened in spite of various international agreements and national policies this is caused by 1 the public nature of many wetlands products and services 2 user externalities imposed on other stakeholders and 3 policy intervention failures that are due to a lack of consistency among government policies in different areas economics environment nature protection physical planning etc all three causes are related to information failures which in turn can be linked to the complexity and invisibility of spatial relationships among groundwater surface water and wetland vegetation integrated wetland research combining social and natural sciences can help in part to solve the information failure to achieve the required consistency across various government policies an integrated wetland research framework suggests that a combination of economic valuation integrated modelling stakeholder analysis and multi criteria evaluation can provide complementary insights into sustainable and welfare optimising wetland management and policy subsequently each of the various components of such integrated wetland research is reviewed and related to wetland management policy

choosing a functional form for an international benefit transfer evidence from a nine country valuation experiment abstract this paper investigates the performance of common approaches in international benefit transfer using data from identical and simultaneous contingent valuation studies on marine water quality in nine european countries the environmental good is shared by the study countries but the countries differ substantially in their income levels and other characteristics we compare the performance of value transfers with or without income elasticity of willingness to pay adjustments and function transfers that include only core variables supported by economic theory our results point to a new source of uncertainty associated with function transfer choosing a particular functional form even if only theoretically relevant explanatory variables are used the theory offers no insights with respect to a functional relationship of the dependence e g linear log linear exponential polynomial we show that while different functional forms may offer improvements in model fit this does not necessarily translate to improvements in transfer errors or minimum tolerance levels in our case the value transfer with constant unit income elasticity adjustment corresponding to the log log functional relationship between willingness to pay and income performs the best including additional explanatory variables or using other functional forms worsens the quality of transfers overall our study questions the rationale for using more complicated function transfers in international benefit transfers as the relationships observed within a country or a group of countries does not necessarily translate to dependencies between countries

environmental inequality and economic valuation i study how the economic value of a heterogeneously distributed environmental public good depends on how the endowment with this good and income are distributed i find that the effect of environmental inequality on the societal willingness to pay wtp for the environmental good is determined both by its substitutability and by the correlation of its provision with income specifically environmental inequality decreases societal wtp for substitutes but this effect is reversed if the environmental good is a complement or distributed strongly in favour of richer households moreover i show that richer households living in places where environmental good endowment is high increases decreases societal wtp if and only if the environmental good is a substitute for complement to consumption goods i propose novel adjustment factors for structural benefit transfer to control for differences in the spatial distribution of environmental goods using forest preservation in poland as an empirical example i find that societal wtp is up to 4 higher for equal access to forests and up to 8 higher for an equal distribution of both income and access to forests

reducing barriers in future benefit transfers needed improvements in primary study design and reporting abstract original research provides many social benefits including additions to our stock of knowledge benefit transfer is a formal process whereby our stock of knowledge rather than original research is used to inform decisions any shortcoming in this stock directly affects our ability to conduct valid and reliable benefit transfers this paper discusses three general criteria that are necessary for valid benefit transfers and how original research designs and reporting of results unnecessarily constrain the potential of benefit transfers we make several suggestions regarding how original research through improved design and reporting might increase the validity and reliability of benefit transfers we also recommend that repositories for original research surveys and data be developed to insure long term availability of study information

capital income taxation in growing open economies abstract this paper studies how alternative capital mobility assumptions affect the incidence and efficiency of capital income taxation the study uses a two country intertemporal equilibrium model in which imperfectly elastic investment captures the notion of imperfectly mobile physical capital if home goods and foreign goods are perfect substitutes and investment is inelastic the tax effects in open and closed economies are similar only if physical capital is perfectly mobile are capital income taxes completely shifted in small open economies only then and if significant terms of trade effects are absent do open economy efficiency losses substantially exceed the closed economy losses

the taxation of capital income in an open economy the importance of resident nonresident tax treatment abstract the authors develop a simulation model of the united states and the rest of the world to demonstrate how international capital mobility alters the incidence and capital formation incentives of taxes on capital income the model explicitly recognizes that u s and foreign investors hold a different mix of assets in each country only a modest degree of international mobility is necessary to substantially alter closed economy patterns of tax incidence differences in the tax treatment of residents and foreigners are particularly important in evaluating tax reductions at the individual level or the integration of corporate and individual income taxes

meta analysis and benefit transfer for resource valuation addressing classical challenges with bayesian modeling abstract the use of meta regression models based on existing studies to estimate the value of resources at a new policy site has become a popular alternative to collecting original data in recent years there are two prevalent dilemmas associated with classical meta regression models the difference in the available set of regressors across source studies and the treatment of methodological explanatory variables in the construction of benefit transfer functions in this study we illustrate how these issues can be addressed efficiently within a bayesian meta regression framework we find that the bayesian model in contrast to its classical counterpart can estimate a relatively large set of parameters including indicators of unobserved study heterogeneity with reasonable accuracy even when the underlying meta sample is small the incorporation of information from regressor deficient source data in the specification of bayesian priors leads to a better model fit and tighter welfare estimates for benefit transfer in our application of freshwater angling

has the cds market influenced the borrowing cost of european countries during the sovereign crisis this paper assesses the potential influence of the growing cds market on the borrowing cost of sovereign states during the european sovereign crisis we analyze the sovereign debt market to ascertain the pattern of information transmission between the cds and corresponding bond markets our methodological innovation is the use of a non linear specification rather than the linear vecm specification customarily employed using a panel smooth transition model during the 2008 2010 period we find that 1 linearity tests clearly reject the null hypothesis of a linear transmission mechanisms between the bond and the cds markets 2 market distress alters the mutual influence and 3 the higher the distress the more the cds market dominates the information transmission between cds and bond markets

the incidence of interest withholding taxes evidence from the ldc loan market abstract during the 1970s developing countries differed widely in their regimes of source based interest withholding taxes this paper provides evidence on the relationship between interest rates paid by private ldc borrowers on international credits the withholding tax regime pre tax interest rates are estimated to increase significantly in withholding tax rates the extent of the mark up into higher pre tax interest rates reflects the offsetting foreign tax credits that banks expect to receive the expected tax credits represent the expected incidence of the non resident withholding taxes on creditor country treasuries estimated expected tax credits as reflected in bank interest rates vary with the year of loan origination they are relatively large for short term loans

economic inequality and the value of nature abstract understanding what influences the value of nature is crucial for informing environmental policy from a sustainability perspective economic valuation should not only seek to determine a society s willingness to pay for environmental goods to devise an efficient allocation of scarce resources but should also account for distributional effects to ensure justice yet how economic inequality affects the value of non market environmental goods remains understudied combining recently developed theoretical results with empirical evidence this commentary shows that more equal societies have a higher valuation for environmental public goods and that non market benefits of environmental policy accrue over proportionally to poorer households on this ground we discuss implications for environmental valuation management and policy making and identify a number of fruitful areas for future research we conclude that environmental valuation should explicitly account for economic inequality and that encompassing assessments of the distributional effects of environmental policies must consider the distribution of non market environmental benefits

environmental value transfer state of the art and future prospects abstract the main objectives of the paper are to 1 give an overview of the state of the art of environmental value transfer 2 discuss its prospects and potential role in cba as a decision support tool and 3 provide further guidelines for proper use and application environmental value or benefit transfer is a technique in which the results of studies on monetary environmental valuation are applied to new policy contexts the technique is controversial not least because of academic and political reservations over the usefulness and technical feasibility of economic valuation tools to demonstrate the importance of environmental values in project or programme appraisals testing of environmental value transfer so far has been unable to validate the practice taking into account the conditions set out in the literature for valid and reliable value transfer most transfers appear to result in substantial transfer errors this paper discusses why and addresses the question of which factors may have been overlooked it is argued that the problem is much more fundamental than previously acknowledged strict guidelines in terms of quantitative adjustment mechanisms to valid value transfer are meaningless if the more fundamental issue of differences in the very nature of the values elicited is not addressed at the same time

measuring ecological capital state of the art trends and challenges abstract it is essential to assess the value of nature as it provides various benefits for human economic development and well being it has been 20 years since two prominent publications came out in valuing nature new concepts and methods have emerged since then this study aimed to 1 investigate the relationship between the new proposed concept ecological capital and the existing two concepts natural capital and ecosystem services and 2 examine the research trends of ecological capital accounting publications from 1997 to 2017 bibliometric analysis was used to reveal the research trends the results showed that the total number of publications has rapidly increased since 1997 and this growth trend will be maintained in the future the most productive journal country institute and author were ecological economics usa chinese academy of sciences and dr verburg respectively ecosystem services and land were the most frequent types of ecological capital non economic evaluation approaches became less of a favorite over time and economic valuation methods were mostly applied in last five years the integration of different methods has attracted increasing academic attention the progress advantages and limitations of different methods were summarized in this study including seea ecological footprint exergy emergy lca and economic valuation approaches as well as newly developed modelling approaches the last part of this study presented three challenges in this academic field the need to 1 establish a standard framework 2 consider the transfer transport of ecological capital and 3 improve capabilities for decision making

market frictions and the pricing of sovereign credit default swaps abstract this paper contributes to the general understanding of how sovereign cds prices are formed by studying the information content of pricing errors generated by a non arbitrage model we implement a price discrepancy measure in the spirit of the noise measure introduced by hu et al 2013 in the treasury bond market and analyze its main determinants in panel data analysis the main results show that sovereign cds pricing errors are systematically related to higher bid ask spreads the evidence in this paper also suggests that exits of capital arbitrage during distressed periods as measured by changes in net offsetting can be associated to larger pricing errors in sovereign cds from advanced economies thereby supporting the main claims of the limit to arbitrage theories these findings are robust for the most common cds pricing models employed in the industry and different estimation techniques

credit default swaps and the credit crisis many observers have argued that credit default swaps contributed significantly to the credit crisis of particular concern to these observers are that credit default swaps trade in the largely unregulated over the counter market as bilateral contracts involving counterparty risk and that they facilitate speculation involving negative views of a firm s financial strength some observers have suggested that credit default swaps would not have made the crisis worse had they traded on exchanges i conclude that credit default swaps did not cause the dramatic events of the credit crisis that the over the counter credit default swaps market worked well during much of the crisis and that exchange trading has both advantages and costs compared to over the counter trading though i argue that eliminating over the counter trading of credit default swaps could reduce social welfare i also recognize that much research is needed to understand better and to quantify the social gains and costs of derivatives in general and credit default swaps in particular

the validity of environmental benefits transfer further empirical testing this paper provides further empirical evidence of the validity of environmental benefits transfer based on cv studies by expanding the analysis to include control factors which have not been accounted for in previous studies these factors refer to differences in respondent attitudes traditional population characteristics were taken into account but these variables do not explain why respondents from the same socio economic group may still hold different beliefs norms or values and hence have different attitudes and consequently state different wtp amounts the test results are mixed the function transfer approach is valid in one case but is rejected in the 3 other cases investigated in this paper we provide further evidence that in the case of statistically valid benefits transfer the function approach results in a more robust benefits transfer than the unit value approach we also show that the equality of coefficient estimates is a necessary but insufficient condition for valid benefit function transfer and discuss the implications for previous and future validity testing

impacts of the financial crisis on eurozone sovereign cds spreads abstract we study the variation of sovereign credit default swaps cdss of eurozone countries their persistence and co movements with particular attention given to the impact of the financial crisis specifically using a dual fractional integration model we test the evidence of long memory for cdss of ten eurozone countries our analysis reveals that price discovery processes satisfy the minimum requirements for a weak form of efficiency for sovereign cds markets even during the crisis in contrast we document the spreading out of persistent cds uncertainty among the peripheral economies with its outbreak we provide evidence that cds uncertainty has implications for the pricing of sovereign risk including that of core countries in the crisis period finally we present the potential spillover effects utilizing a dynamic conditional correlation model and show that with the collapse of lehman the probability of a contagion increased across all countries and became more explicit for peripheral economies as the sovereign crisis took on a new dimension

sovereign bond market dependencies and crisis transmission around the eurozone debt crisis a dynamic copula approach abstractwe examine the dependency between the european government bond markets around the recent sovereign debt crisis a dynamic copula approach is used to model the time varying dependence struct

income inequality and willingness to pay for environmental public goods we study how the distribution of income among members of society and income inequality in particular affects social willingness to pay wtp for environmental public goods we find that social wtp for environmental goods decreases increases with income inequality if and only if environmental goods and manufactured goods are substitutes complements we derive adjustment factors for benefit transfer to control for differences in income distributions between a study site and a policy site for illustration we quantify how social wtp for environmental public goods depends on the respective income distributions for empirical case studies in sweden and the world at large we find that the adjustment for income inequality can be substantial

the tax sensitivity of us direct investment in canadian manufacturing abstract this paper analyzes the impact of canadian and us tax systems on direct investment flows between the two countries regression results from two direct investment models confirm the tax sensitivity of international investment flows and indicate that lower effective tax rates in canada have led to excessive american investment in canadian manufacturing though the resulting welfare losses to date have been relatively small simulations suggest that the introduction of other more nationalistic tax systems by te united states would have produced significant welfare losses

the implications of heterogeneous habit in consumer beverage purchases on soda and sin taxes abstract in this article we study the heterogeneity of habit strength in households demand for regular carbonated sweetened beverages csbs and beer in the united states a demand model that nests a smooth transition function is used to describe habit based consumption patterns revealing heterogeneous strengths of habits among households we find that more habitual consumers those with a strong preference for a particular product are not as sensitive to price or expenditure as the aggregate population this finding is further supported by simulations of the potential effects of soda and beer taxes we find the aggregate response to soda and beer taxes is smaller than when the influence of habit is assumed to be homogeneous

benefit transfer via preference calibration prudential algebra for policy this paper proposes a new approach to benefit transfer the method assumes a specific form for preferences and uses available benefit information to identify and calibrate the preference parameters to match the existing benefit estimates this approach assures economic consistency of the transfers benefit measures can never be inconsistent with household income the logic also offers a series of potentially observable predictions that can be used to gauge the plausibility of benefit transfers when multiple benefit estimates from different methods are available such as hedonic property value travel cost demand and contingent valuation the framework uses the definition of the benefit concept from each method in a single preference function to reconcile differences it provides a specific way to take account of baseline conditions and scope effects i e the size of the proposed change consistently in the transfer the method is illustrated using estimates for benefit measure changes in water quality from three studies travel cost demand hedonic property value and contingent valuation analysis q26

the effectiveness of corporate tax incentives for foreign investment in the presence of tax crediting abstract the value of corporate tax holiday incentives provided by central eastern europe cee countries to attract foreign investment depends on whether a multinational company must pay corporate income taxes to its home government on income remitted from abroad i e the multinational is said to be in a deficient credit position if foreign taxes paid are less than the home country tax owing on foreign source income this paper examines the value of corporate tax incentives given to manufacturing companies investing in cee countries taking into account both the host country tax regime and the u s tax treatment of foreign source investment

meta analysis of empirical evidence on energy poverty the case of developing economies abstract energy poverty has evolved as an important issue of research from academic and policy perspectives during the last two decades the energy poverty estimates exhibit widespread variations across regions methodologies and datasets making the task of energy and development policies challenging the variations in energy poverty estimates necessitate a systematic and rigorous analysis of these empirical studies to obtain a true measure of energy poverty the present study conducts a meta analysis of 30 studies and 103 estimates of energy poverty on average 71 1 percent of the population in the overall sample studies has been identified as energy poor high i square statistic values suggest heterogeneity bias in the sample studies therefore analysis at the subgroup level has been conducted meta regression analysis of overall sample and subgroups has identified type of methodology citations impact factor of the journal regional dummies average key crude oil price and gross domestic product as significant factors that explain heterogeneity in the energy poverty effect sizes we recommend inclusion of local and regional factors in assessment of energy poverty for developing a uniform methodology to assess energy poverty across developing economies

credit swap valuation this review of the pricing of credit swaps a form of derivative security that can be viewed as default insurance on loans or bonds begins with a description of the credit swap contract turns to pricing by reference to spreads over the risk free rate of par floating rate bonds of the same quality and then considers model based pricing the role of asset swap spreads as a reference for pricing credit swaps is also considered

value of recreational fishing in the brazilian pantanal a travel cost analysis using count data models abstract recreational fishing value of the brazilian pantanal is measured using travel cost method tcm we compare non linear poisson and negative binomial count data models to estimate recreational fishing trip demands the count data and truncated models are used primarily to account for non negative integer and truncation properties of recreational fishing trips as suggested by the recreation valuation literature the results reveal that non linear and truncated count data models perform relatively well in our study the economic values of recreational fishing in terms of consumer surplus cs are derived using non linear and truncated models we estimate the cs values from 540 54 to 869 57 per trip resulting in the total social welfare estimate range from 35 to 56 million the study demonstrates a relatively high value of recreational fishing in the pantanal in comparison to similar studies conducted in other parts of the world the findings of this study would be important for resource management decisions in the pantanal and could serve as a reference in valuing similar resources in other ecosystems around the world

foreign tax credits the supply of foreign capital and tax exporting a numerical general equilibrium model of corporate tax reform in canada abstract this paper employs a numerical general equilibrium model to emphasize the importance of tax exporting in determining the welfare effects of tax changes in open economies tax exporting occurs through both changes in the terms of trade and changes in the net return paid to foreign owned capital results indicate that tax exporting may be as significant as efficiency in evaluating potential reforms moreover efficiency effects are strongly influenced by whether foreign capital flows are modelled as responding to the gross rental on capital or to the net rental in consideration of the role of foreign tax credits