factors influencing differences between survey and market based environmental value measures a unique us database combining survey and housing data is used to obtain household level stated and market based willingness to pay wtp measures to avoid living near landfills systematic differe

option value empirical evidence from a case study of recreation and water quality a procedure for measuring option value and other preservation values of water quality is developed and applied to a case study area in the south platte river basin colorado benefits from water based recreation activities are the focus of the study the results provide an empirical test and confirmation of weisbrod s proposal that option value and other preservation values represent important social benefits and should be added to the aggregate consumer surplus of recreation activities to determine the total benefit of environmental amenities to society in the absence of such an estimate insufficient resources would be allocated by society to preservation of unique environments such as pristine mountain streams where mineral and energy development may irreversibly degrade water quality

contingent values as implicit contracts estimating minimum legal willingness to pay for conservation of large carnivores in sweden mean willingness to pay wtp based on multiple bounded discrete choice responses from contingent valuation surveys are normally obtained using some kind of parametric estimator this paper instead exploits the possibility to interpret the response to the discrete choice question as an implicit contract between the researcher and the respondent resulting in a minimum legal wtp mlw estimator never previously used in valuation literature it is used in this paper to estimate the wtp for the preservation of large carnivores in sweden based on a large scale national survey results show that mlw estimates only were 12 19 of the comparable parametric estimates in keeping with other results in contingent valuation literature we find that the mlw estimates are positively related to the educational level income and the fraction of urban population while negatively related to age among the advantages of the mlw estimator is its transparency as well as the fact that it rests on a contractual notion of wtp

population growth and savings in ldcs a survey article both population growth and savings have traditionally taken a certain place of pride among models of growth and development the purpose of this paper is to examine the literature concerning the hypothesis that the savings rate itself is a function of the population growth rate and this effect exacerbates the negative effect of population on economic growth the evidence is examined from three perspectives i macroeconomic effects of variations in the age structure of the population ii choice theoretic models of family decision making particularly the joint determination of fertility decisions and savings decisions and iii market level interactions of variables which determine individual decisions the paper concludes that both population growth and savings rates are inextricably tied up in the process of economic development there are many ways in which the two variables may interact but no generalizations can be safely made across countries

valuing option existence and bequest demands for wilderness to assess the relative importance of current costs and future benefits of nuclear waste storage we develop a simple model of bequest value the basic model of nonparternalistic altruism is extended to account for the uncertain nature of the externality

testing for non response and sample selection bias in contingent valuation analysis of a combination phone mail survey we use a combination phone mail survey to test for possible sample biases in contingent valuation we find no sample selection bias but do find non response bias we show how failure to correct for non response bias distorts aggregate benefit estimates

differences between continuous and discrete contingent value estimates in a split sample contingent valuation study of willingness to pay wtp for food safety improvements the dichotomous choice dc elicitation method consistently generated much larger estimates of wtp than did a continuous method little or none of these differences was due to bias introduced by the statistical techniques used with the dc data most or all of the difference was due to differences in respondent behavior in addition the continuous wtp responses showed a significant scope effect while the dc responses did not the observed difference in behavior may be attributable in part to yea saying by dc respondents

us business credit sources demand deposits and the missing money abstract this study accounts for much of the missing money in the us through compensating balances business lending by banks affects demand deposit growth standard money demand models include variables that likely pick up income and interest rate effects on the transactions demand for demand deposits and on compensating balance requirements provided that bank lending to firms is stable however during the missing money period business shifted toward nonbank sources of short term credit causing a decline in compensating balances empirical finding support this hypothesis as a partial explanation for the missing money using the federal reserve board s demand deposit model

a test of the equality of closed ended and open ended contingent valuations a test is developed to find whether open ended and closed ended contingent valuation mechanisms lead to significantly different results the test is based on joint estimation of willingness to pay responses to open and closed ended questions asked of the same sample of individuals in a public good example individuals do respond differently depending on question format possible explanations include different incentives for strategic behavior and respondents lack of familiarity with the open ended question type no differences in willingness to pay were found in a private good example

valuing environmental commodities some recent experiments a general model of consumer behavior is proposed to assess six recent experiments that have attempted to reveal preferences for environmental goals each experiment used a mix of both the techniques and the theory of demand for non market commodities and each was designed to estimate a non market attitude associated with the environment and to analyze potential biases in the techniques the six cases show some consistency in results the linkage within the contingent market between the environmental attribute institutional setting and the bidding instrument must be realistic and accepted by the respondent to avoid biased results possibly the most important result is the replication of results using a traditional property value study and a contingent bidding approach all evidence obtained to date suggests that hedonic studies of property values or wages travel costs and survey techniques all yield values well one order of magnitude in accuracy 41 references 2 tables

the worth of a possum valuing species with the contingent valuation method the focus of this paper is on methods of assessing the value peopleplace on the conservation of species for use in policy making of principalinterest is the relatively new methodology of contingent valuation whichis a method for asking people directly about their preferences the paperpresents an application of the contingent valuation method to theconservation of an endangered species in the state of victoria australia the results emphasise the importance of careful survey design implementation and analysis as well as the precise definition of theenvironmental good being valued consequently the contingent valuationmethod does provide information relevant to decision making processesbased on monetary economic considerations thus in orthodox economicterms it makes sense to conserve species but there are other moral andethical grounds for conserving species as well

structural changes and the us money demand function previous literature on the stability of the us money demand function suggests mixed results in this article we study the stability of the money demand function from the standpoint of structural changes in the function we first investigate if a stable money demand function can be found for the us for the period from the first quarter of 1959 to the fourth quarter of 2000 the results show that a stable long run money demand function does not exist for the sample period under consideration we then estimate unknown structural break points in the variables of the money demand function using bai and perron s 1998 method and test if there is a stable relationship in each sub sample period of the break points the results show that a stable relationship exists for each sub sample period the estimated income elasticity and interest rate semi elasticity are relatively smaller than ball s 2001 estimates but consistent with his argument

the nature of the savings function in developing countries a survey of the theoretical and empirical literature the savings rate marginal or average is regarded as a key performance indicator by development economists and foreign aid practitioners admonish their clients to increase their savings ratio as a primary condition for achieving a satisfactory rate of economic growth however not only have questions been raised regarding the significance of the savings effort as an independent determinant of economic progress but the formulation of policies designed to increase the savings propensity has suffered from a dearth of knowledge regarding the nature of the savings function in developing countries a number of alternative savings hypotheses derived mainly from the literature relating to developed economies have been advanced but the paucity of reliable data has made it difficult to test these hypotheses and obtain results which warrant a reasonable degree of confidence the purpose of this article is a to review the theoretical and empirical literature on the savings function in developing countries b to assess critically the findings with respect to the major hypotheses and c to summarize the state of our knowledge on this important topic we shall begin with a brief review of the nature of the data on savings in developing countries with which economic analysts must work

the new approach to wilderness preservation through benefit cost analysis over the last 15 years economists of resources for the future led by john krutilla have been developing a new approach to wilderness preservation this paper offers a concise exposition of their approach and adds a few new steps the basic ingredient of the new approach is a perception of declining net benefits of wilderness development and rising net benefits of wilderness preservation over time these alter the entire shape of the benefit cost analysis of potential development the new steps involve reversibility postponability and recognition of multiple interest rates

determinants of private savings behaviour in turkey this study investigates the effects on private saving rates of a number of policy and non policy variables the analysis covers the period 1968 1994 the empirical private saving model for turkey is estimated the findings support the hypothesis that private saving rates have strong inertia the evidence indicates that government saving does not tend to crowd out private savings and the ricardian equivalence does not hold strictly income level has a positive impact on private saving rate and growth rate of income is not statistically significant from a policy point of view financial depth and development measures in turkey suggest that countries with deeper financial systems tend to have higher private saving rates private credit and real interest rates try to capture the severity of the borrowing constraints and the degree of financial repression for turkey moreover the negative impact of life expectancy rate lends support to the life cycle hypothesis the precautionary motive for saving is suppor

household consumption of cheese an inverse hyperbolic sine double hurdle model with dependent errors the dependent double hurdle model is generalized by an inverse hyperbolic sine transformation of the dependent variable the resulting specification features a flexible parameterization accommodates heteroskedastic errors and nests a range of common limited dependent variable models results for u s household cheese consumption suggest that the homoskedastic and normal double hurdle model is misspecified income elasticities are small and vary across household groups foodstamp recipients are more responsive to income changes than nonrecipients foodstamp recipients are also less likely to consume cheese but conditional on consumption spend more than nonrecipients

the demand for money a rational expectations approach the authors derive a model of money demand for an optimizing consumer with rational expectations in a discrete time infinte hortizon framework under uncertainty mone y demand responds to unanticipated changes in income one period expe ctations of future bond and money interest rates unanticipated curre nt interest rates and past anticipations of current rates the deriv ed consumption function mirrors money demand behavior joint estimati on of the consumption and money demand equations by weighted nonlinea r least squares corroborates the predicted effects particularly inco me neutrality this money demand model substantially outperforms a co nventional specification in post sample simulation over 1975 85 copyright 1988 by mit press

the effect of protest votes on the estimates of wtp for use values of recreational sites contingent valuation studies are often characterized by a considerable number of protest responses which may cause selectivity bias on the final estimates for wtp sample selection models can detect and if necessary correct selectivity bias in economic applications where the relevant dependent variable is continuous sample selection models are generally estimated using heckman s 2 step method rather than the fiml estimator either method has its own drawback computational complexity for the fiml method susceptibility to collinearity problems for the 2 step method using data on valuation of forest resources for recreational use we analyse the performance of the two estimators in this application given the presence of some collinearity the fiml is preferred to the 2 step method a procedure is outlined to deal with selectivity problems in similar settings

valuing non market wildlife commodities an evaluation and comparison of benefits and costs this paper compares the benefits and costs of nature conversation at three sites of special scientific interest benefits are estimated by contigent valuation expressed preferences and also the travel cost method revealed preferences oppurtunity costs are assessed from a financial cost viewpoint and also in terms of shadow prices or social costs results indicate that the valuation of wildlife and nature conservation largely depends upon the frame of reference adopted that social costs are considerably less than financial costs due to the effect of the common agricultural policy that user benefits are considerably less than financial costs and non user benefits must be included to cover even the social costs of nature conservation

dependency rates and savings rates reply arthur goldberger s comment is a tempest in a teacup this is readily verified from the data presented in table 1 this table reproduces from my original paper the coefficients for paired equations estimated with three different samples in which in s n and ln si y were the dependent variables as the data of table 1 indicate in 7 of the 12 cases the coefficients are identical through the second decimal place furthermore all the discrepancies are quantitatively very small in 9 cases the paired parameter estimates are within 1 percent of each other in the remaining cases the differences are of the magnitude of 0825 0012 and 0011 these are well within the margins of accuracy within which anyone views data generated from the national income accounts of the less developed countries in light of these considerations it is difficult to understand the tone of goldberger s comment the reason for the slight discrepancies is straightforward my observations for s n and s y were computed separately from data supplied by the statistical office of the agency for international development with the rounding introduced by the series for n and y it is not surprising that the series for s n is not identically equal to the series which would be obtained by forming s n from the product of y n and s y similar slight discrepancies have also been reported in other econometric work in which equations for s n and s y have been estimated with separately computed data series in any case nowhere in my paper did i even refer to the precise numerical parameter estimates obtained in my equations the main conclusions of the paper were that the dependency variables were quantitatively an important determinant of international savings rates and further that introduction of these variables greatly reduced the importance of percapita income on which some previous discussions had focused neither of these conclusions is affected by goldberger s comment

how capital regulation and other factors drive the role of shadow banking in funding short term business credit abstract this paper empirically analyzes how capital regulation risk and other factors altered the relative use of shadow banking funded short term business debt since the early 1960s results indicate that the share was affected over the long run not only by changing information and reserve requirement costs but also by shifts in relative regulation of bank versus nonbank credit sources such as basel i in 1990 and reregulation in 2010 in the short run the shadow bank share rose when deposit interest rate ceilings were binding on traditional banks the economic outlook improved or risk premia declined and fell when event risks arose

working wives and food away from home the box cox double hurdle model household expenditures on food away from home are analyzed with the use of the bls 1989 consumer expenditure survey parameterization and distributional assumptions of cragg s double hurdle model are generalized for this purpose and the resulting model outperforms the more traditional ones results suggest households with working wives and those with higher income are more likely to consume food away from home and also to consume more than others wife s age and household size increase the conditional level of consumption education has conflicting effects on probability and conditional level of consumption

differentiating use and nonuse values for coastal pond water quality improvements this paper measures the benefits of water quality improvements in three coastal ponds on the island of martha s vineyard massachusetts u s a use option and existence values were elicited from martha s vineyard property owners by the contingent valuation method on average more than half of the total benefits are attributed to existence value results from the heckman selection model show that the exclusion of protest as well as missing bids does not cause significant bias in estimating respondents willingness to pay socioeconomic characteristics are found to have distinctively different influences on use option and existence values different model parameters are likely to be estimated depending on which value categories are measured by a selected valuation technique these findings emphasize the importance of nonuse values from water quality improvements and of socioeconomic characteristics for measuring different categories of values

the search for a stable money demand function a survey of the post 1973 literature phe question of whether the demnand function for money is stable is one of the most important recurring issues in the theory and application of macroeconomic policy what is being sought in a stable demand function is a set of necessary conditions for money to exert a predictable influence on the economy so that the central bank s control of the money supply can be a useful instrument of economic policy as such the notion of a stable demand function appears to involve three key elements e g john t boorman 1976 p 317 and david e w laidler 1977 pp 34 35 first the demand for money relation should be highly predictable in a statistical sense as measured by the usual goodness of fit statistics precision of estimated coefficients and presumably its ability to forecast accurately out of sample second a stable demand function for money has relatively few arguments a relationship that requires knowledge about a large number of variables in order to pin it down is in effect not predictable finally the variables that appear as arguments in the function should represent significant links to spending and economic activity in the real sector in sum a stable demand function for money means that the quantity of money is predictably related to a small set of key variables linking money to the real sector of the economy the importance of a stable money demand function for monetary policy can be illustrated with the standard is lm model in which interest rates and gnp are the endogenous variables in this context a stable demand function for money translates into a well defined relationship between money interest rates and gnp

the impact of mortgage activity on recent demand deposit growth abstract this study quantifies the substantial effects of mortgage activity on recent demand deposit growth and finds that estimates and forecasts of recent demand deposit growth are considerably more accurate using data adjusted for mortgage activity

asymmetric information and a theory of compensating balances this paper derives an economic justification for the existence of compensating balance requirements using an equilibrium model of asymmetric information because bank profitability depends upon the probability distribution of a borrower s future cash requirements and assuming this distribution is known by the borrower but not by the bank compensating balance requirements can be used by the bank as a screen to distinguish among borrowers compensating balances are shown to exist without invoking assumptions of monopoly banks or non maximizing behavior and these balances need not be explained as a method of indirect payment for bank services

should bond funds be added to m2 abstract in the early 1990s m2 growth has been weaker than estimated while bond mutual funds have grown rapidly this study assesses whether adding bond funds to m2 would yield a monetary aggregate that is more explainable using a standard error correction model of money with and without modifications for bond interest rate and thrift resolution effects results indicate that it is important to net out institutional and ira keogh assets from bond funds as is done for m2 and that adding such a bond fund series to m2 results in an aggregate that is somewhat more explainable than m2

universal health insurance in the clinton plan coverage as a tax financed public good the financing arrangements embodied in the clinton health reform plan involve some important differences in the way in which public goods are usually financed the subsidies to small low wage firms mandated to provide benefits distort markets in both labor and products and offer incentives for the creation of small firms in addition the financing scheme implicitly envisions a head tax on families at modest income levels but offers a possible rationale for it nevertheless the main reason for many of the financing features appears to be an attempt to hold down the apparent budgetary cost of universal coverage

the behavior of money demand in the 1980s existing money demand functions did not predict the strength in m1 in the 1980s this strength derived from the combination of a change in the character of m 1 due to elnancial deregulation and the sharp fall in market rates that began in 1982 the public s m2 demand function however remains unaffected by the forces that altered the m1 demand function the character of the public s m 1 demand function changed with the legalization nationwide in january 1981 of the checkable deposits known as nows because nows pay explicit interest they are used by the public as an instrument for saving as well as for effecting transactions mehra 1986 the addition of nows to m1 therefore caused m1 to become more highly substitutible with the savings instruments included in the non ml component of m2 that is savings deposits small time deposits money market deposit accounts mmdas and money market mutual funds of noninstitutional investors mmmfs furthermore financial institutions move the rate paid on nows only sluggishly in response to changes in market rates in contrast the rates paid on small time deposits mmdas and mmmfs move promptly in response to changes in market rates consequently when market rates fell beginning in late summer 1982 the differential between the rates paid on the non ml components of m2 and on nows fell sharply the public then substituted out of the non ml components of m2 and into the nows in m1 these substitutions increased m1 de

estimation of a type 2 tobit model with generalized box cox transformation this article considers estimation of a type 2 tobit model with bickel doksum transformation of the dependent variable of the regression equation the basic idea is that while the transformed depend

improved estimation of willingness to pay in dichotomous choice contingent valuation studies this paper uses recently developed statistical techniques to achieve improved parameter estimates from models ofdichotomoiis choice contingent valuation data random effects associated with bid amounts presented to respondents are modelled alongside the variance of individual responses to give a nested model which more truly reflects the structure of the data being analyzed quasi likelihood methods for estimating parameters in such hierarchical models are discussed and a simulation method for assessing goodness of fit is demonstrated however estimated parameters may still be biased and hence a parametric bootstrap technique is presented and compared to a delta method approximation jel q26

an analysis of under reporting for micro data sets the misreporting or double hurdle model abstract this paper analyzes under reporting through the two extended tobit models p tobit and double hurdle models the empirical results clarify the characteristics of under reporting misreporting plays an important role in under reporting

compensating balance rationality and optimality the rationality of requiring compensating balances in commercial lending is a long standing controversy this paper demonstrates that compensating balance requirements can be either rational or irrational and derives the conditions under which each may occur the model presented is capable of explaining illustrating and resolving analytically and graphically the apparent inconsistency among conclusions of previous studies in addition the model entertains questions of optimality in borrowing arrangements

a box cox double hurdle model of wildlife valuation the citizen s perspective abstract a stated preference approach is used to elicit the attitudes of the general public towards coyote conservation the payment vehicle is presented in a way that explicitly prompts respondents to adopt a citizen perspective rather than a consumer perspective when responding to the survey to deal with the large numbers of zero responses a box cox double hurdle specification is used to model separately individuals choices about whether to support conservation or not and their choice about the level of support the results show that simpler analyses that do not account explicitly for these two different decisions would lead to misleading conclusions in the study of nuisance wildlife the study uses primary data from prince edward island canada

valuing public goods a comparison of survey and hedonic approaches although the theory of public goods has progressed rapidly since paul samuelson s seminal article the empirical measurement of the value of demand for public goods only recently has received increased attention perhaps the best known and most widely accepted empirical approach has been the use of hedonic prices wherein for example it is assumed that either wages or housing values reflect spatial variation in public good characteristics of different communities this indirect approach based on theoretical work of charles tiebout kelvin lancaster sherwin rosen and others has proven quite successful among public goods or bads which have been valued using the hedonic approach are climate i hoch air pollution robert anderson and thomas crocker d harrison and d rubinfeld social infrastructure r cummings et al and other community characteristics such as noise level j nelson and ethnic composition ann schnare an alternative approach is to directly ask households or individuals to state their willingness to pay for public goods using survey techniques despite arguments that strategic bias will invalidate survey results there exists the need for an alternative to the hedonic approach as an example consider the case of a remote and unique scenic vista valuable to recreators which is threatened by air pollution from a proposed coal fired plant a typical situation in the western united states although it is possible in principle to impute the value of clean air and visibility from the relative decline in local visitation which might follow construction of a power plant information on the value of visibility at the site is needed prior to construction for socially optimal decision making on plant location and pollution control equipment the hedonic approach is unavailable both because the scarcity of local population as opposed to recreators makes use of wage or property value data impossible and because scenic vistas may themselves be unique for these reasons a randall et al first applied survey methods for valuing visibility and other environmental effects of large coal fired power plants in the four corners region of new mexico since this initial application the survey approach has been widely used to value environmental commodities where market data for hedonic analysis is difficult to acquire see for example brookshire ives and schulze rowe et al brookshire et al other early attempts to value public goods using the survey approach include r davis peter bohm and j hammack and g brown although results of using the survey approach for estimating the value of public goods appear to be internally consistent replicable and consistent with demand theory see schulze et al little work on external validation has been reported thus the purpose of this paper is to report on an experiment designed to validate the survey approach by direct comparison to a hedonic property value study the los angeles metropolitan area was chosen for the experiment because of the well defined air pollution problem and be assistant professor university of wyoming assistant professor university of missouri rolla associate professor university of wyoming and professor university of wyoming respectively the research reported here was funded under a grant methods development for assessing air pollution control benefits from the u s environmental protection agency we would like to give special thanks to alan carlin and shelby gerking for their helpful suggestions and contributions additional helpful comments were received from a myrick freeman iii john tschirhart and james murdoch all conclusions are of course our sole responsibility

adopt a hypothetical pup a count data approach to the valuation of wildlife the willingness to pay wtp for a coyote conservation program is estimated using a novel payment vehicle based on how many problem coyotes respondents would be willing to sponsor for a year this hypothetical scenario mimics an increasingly popular type of actual market data from a phone survey conducted in prince edward island are analyzed using count data models that consider different processes explaining zero responses and the level of positive responses this is particularly important in the case of coyotes often regarded as an economic bad estimates of wtp per coyote per year around 18 22 and annual wtp per contributor of about 46 57 are obtained

aggregation and deliberation in valuing environmental public goods starting from a distinction between kantian principle based and utilitarian preference based approaches in political theory this essay argues that we may understand normative judgments individuals make about policy to express principled views of the public interest or purpose not private preferences about their own consumption opportunities these judgments in other words state opinions about what we ought to do as a society rather than report preferences about what i want as a utility maximizer this essay then argues that contingent valuation can take into account these kinds of judgments which dominate public discourse about the environment only if it moves toward a deliberative discursive jury like research method emphasizing informed discussion leading toward a consensus based on an argument about the public interest

spike models in contingent valuation spike models allow for a nonzero probability of zero willingness to pay in referendum style contingent valuation experiments they include many of the often used models as special cases and allow various analyses that are not possible in standard applications in this paper the economic rationale for the spike models and their estimation techniques are discussed and empirical illustrations are provided one study suggests that mean willingness to pay is zero and both studies strongly suggest that median wtp is zero these results have some bearing on the continuing debate of the incentive properties of hypothetical surveys and the construction of scenarios in contingent valuation experiments

contingent valuation controversies and evidence contingent valuation cv has become one of the most widely used non market valuation techniques cv s prominence is due to its flexibility and ability to estimate total value including passive use value its use and the inclusion of passive use value in benefit cost analyses and environ mental litigation are the subject of a contentious debate this paper discusses key areas of the debate over cv and the validity of passive use value we conclude that many of the alleged problems with cv can be resolved by careful study design and implementation we further conclude that claims that empirical cv findings are theoretically inconsistent are not generally supported by the literature the debate over cv however has clarified several key issues related to nonmarket valuation and can provide useful guidance both to cv practitioners and the users of cv results

measuring impartial preference for biodiversity biodiversity undergoes unprecedented rates of erosion despite the important services it provides this is considered evidence that biodiversity is undervalued biodiversity valuation is accordingly a prominent issue in the literature economic valuations are however largely criticized numerous alternatives have been introduced most of them involve participatory protocols aimed at producing high quality results being time consuming and expensive it is difficult to implement and reproduce them at a large scale we produce an easily reproducible inexpensive survey methodology to measure impartial preference for biodiversity we implement it in switzerland through a mail based survey our result is that biodiversity should be ranked after retirement schemes and public transportation but before relations with foreign countries order and security and culture and leisure in the expanses of the state current expenses therefore substantially underestimate the value that swiss people grant to biodiversity our new method is a viable alternative to standard economic valuation given the impartiality achieved at least in the swiss political context our estimate can be used by decision makers to assess the legitimacy of conservation programs or to gauge public support at a philosophical level our measure is relevant for public policies because it captures the stances that people take when they participate in public decisions

do existence values for cost benefit analysis exist the use of the contingent valuation method to generate estimates of existence value for input to cost benefit analysis requires that individuals have utility functions defined over the relevant arguments the validity of the assumption that the required utility functions generally exist has been questioned it has been argued that some individuals will respond on the basis of lexicographic preference orderings it has also been argued that some individuals do not consider that market or individual willingness to pay criteria are appropriate where existence value type issues are at stake the paper considers survey evidence bearing upon these arguments it is concluded that the evidence is consistent with the view that it is incorrect to proceed on the assumption that individuals generally satisfy the assumptions required for the existence of existence values for use in cost benefit analysis

an independent sample test of yea saying and starting point bias in dichotomous choice contingent valuation abstract we developed several diagnostic tools to test the convergent validity of two common contingent valuation elicitation procedures data were collected from independent samples receiving dichotomous choice and payment card questions we compared actual with counter factual responses using deterministic and monte carlo methods and we found that wtp distributions and mean values varied by the value elicitation method we also developed a paired comparison test for procedure variance which indicated that yea saying and starting point bias influenced dichotomous choice responses

statistical models for zero expenditures in household budgets household budget surveys are an important source of data on consumer s expenditure not just for individual consumers but also for estimating national aggregates however it is a widespread finding that for certain commodities most notably tobacco and alcohol the estimate from the household survey falls short of the known consumption total calculated with some confidence from data on production imports exports and excise duties for example in the british family expenditure survey with which we shall largely be concerned total tobacco expenditure was underestimated in 1976 by 21 percent see kemsley redpath and holmes 1980 p 51 much of this understatement together with that on alcohol is thought to occur because of the design of the survey which excludes many persons amongst whom consumption of such items is thought to be atypically high e g prisoners hoteliers and their residents merchant seamen even so the possibility remains that some of the understatement is due to various types of misreporting by households included in the survey in this paper we consider a model in which the standard tobit specification tobin 1958 is supplemented by the operation of a simple binary censor the tobit model is essentially a linear regression model in which non positive observations of the dependent variable are replaced by zero we take this specification as our starting point but add a second censoring process that randomly replaces a fraction of the observations generated by the tobit model bv zeroes the combined model can serve as a representation of several types of

parametric and semi nonparametric estimation of willingness to pay in the dichotomous choice contingent valuation framework standard procedures for extractingwillingness to pay wtp from dichotomouschoice cv questionnaires rely heavily uponparametric assumptions regarding thedistribution and form of wtp in the sampledpopulation however theory provides littleguidance regarding which parametricspecification to use and the resulting wtpestimates can be sensitive to the selectionsmade here we compare and contrast severalparametric and semi nonparametric estimatorsthat have been proposed in the literature examining the sensitivity of the resulting wtpestimates to the underlying distribution ofpreferences and the estimation procedureemployed

the demand for alcoholic beverages in spain the objective of this study is to analyze the main determinants of alcoholic beverages consumption at home data comes from the latest spanish household national survey which provides information on expenditure and quantities of different food products by household because households are interviewed only 1 week a large number of zeros have been recorded among the existing censured demand models the double hurdle dh model the purchase infrequency model and the tobit purchase infrequency model among others and after carrying out model selection tests the dh model has been finally estimated all expenditure elasticities are positive corresponding the highest value to spirits own price elasticities are negative and also in this case the spirits exhibit the highest value socio economic variables also play an important role in explaining consumer purchase and consumption decisions

fairness in the contingent valuation of environmental public goods attitude toward paying for environmental improvements at two levels of scope abstract respondents to contingent valuation cv surveys give a variety of reasons for not wanting to pay money this variability is likely to reflect people s attitudes toward paying for the public good change their attitudes toward paying for public goods in general and a component that is independent of these attitudes but unique to particular beliefs about paying e g i can t afford to pay negative attitudes toward paying can contribute to an apparent insensitivity to different levels of the same public good in a telephone survey northern wisconsin property owners were asked about their wtp for four environmental public goods biodiversity indian spearfishing water quality and wolves at two levels of scope part and whole for water quality and spearfishing the part was a chain of lakes that was geographically nested within a larger region of lakes similarly the biodiversity whole represented a region comprising the smaller level of the public good the scope conditions for wolves were quantitatively nested levels of returning 300 and 800 wolves to northern wisconsin respondents beliefs about paying for each public good and level of scope were measured in order to test their generality across the different public goods and levels of scope negative attitudes toward paying that are general across public goods place restrictions on the use of cv for environmental public goods however negative attitudes that are tied to specific environmental public goods suggest that the valuation method might be difficult to implement in these cases only moreover negative attitudes toward paying that are either general or specific may contribute to perfect embedding when they are expressed across different levels of scope for the same public good respondents beliefs about paying for each public good were associated with an attitude toward paying for the respective good and an attitude toward paying for public goods in general at both levels of scope the general attitude was more explanatory of beliefs about paying for wolf reintroduction and spearfishing than were the specific attitudes the distribution of beliefs was sensitive to the type of good being valued but less so to the scope of the public good change contingent valuation practitioners should seek improvements in respondents perceptions of the fairness of the valuation process in order to facilitate citizens involvement in decisions about environmental public goods avenues for future research are proposed and discussed

multivariate mixed models for open ended contingent valuation data willingness to pay for conservation of monk seals although dichotomous choice dc contingent valuation cv has been recommended by the us noaa blue ribbon panel for large scale contingent valuation studies useful information can still be obtained from smaller open ended oe studies often undertaken as a precursor to a dc survey the cv study considered here was carried out in greece and looked at willingness to pay wtp for protecting the mediterranean monk seal monachus monachus in the aegean area this is the most endangered seal in the world and the application of the cv methodology was the first such application in greece the oe data consist of two responses first a binary response detailing whether or not respondents were in principle prepared to pay for the protection of this seal secondly those respondents who answered yes to the first question were then asked to state their maximum wtp for such protection a multivariate binomial log normal mixture model is used to develop a bid function including explanatory variables such as income sex age and education such a modelling approach provides an alternative to more commonplace tobit estimation however the model is extended to include further information which was collected on

a double hurdle model of cigarette consumption this paper shows the importance of the double hurdle approach for modelling individuals cigarette consumption using data from the uk general household survey and argues that participation and consumption should be treated as separate individual choices the likelihood function for the full double hurdle is derived and it is shown how restrictions on the stochastic specification of the model and auxillary information which identifies ex smokers allow it to be decomposed the empirical results highlight the value of the sample separation information and the need to model starting and quitting as separate decisions

the values jury to aid natural resource decisions congressional legislation emphasizes that public resource allocation should reflect the values citizens assign to those resources yet information about assigned values and preferences of members of the public including economic measures of value required by decision makers is often incomplete or unavailable existing sources of information about the public s values for use in resource allocation decisions and damage assessment include existing markets public surveys including contingent valuation and public involvement each of these sources has serious limitations

self interest altruism and health risk reduction an economic analysis of voting behavior while classical economic theory suggests that the demand for private goods is motivated by economic self interest a growing body of literature suggests that the demand for public goods is driven both by self interest and by altruistic motives the political arena has been a major testing ground for this hypothesis recently a number of studies have tried to empirically isolate and determine the importance of economic versus ideological factors in explaining political choices by representatives kau and rubin 1979 peltzman 1984 kalt and zupan 1984 while congressional voting records have provided a rich source of data for empirical analysis a consensus opinion on the importance of self interest versus altruism has not been reached and remains controversial altruistic motivations have also been

timber harvest adjacency economies hunting species protection and old growth value seeking the dynamic optimum abstract forests have the potential to provide ecosystem services timber mature growth aesthetics and wildlife and endangered species protection forest managers are faced with complex ecosystem management decisions due to competing and complementary social values and differential interactions of these social values with timber production as a result management strategies can have dramatic aggregate and intertemporal welfare implications this paper portrays the trade offs and externalities in choosing or changing the forest management objective and the resulting rankings of management policies in addition the paper analyzes the role of economies of scale in harvest area where larger harvest areas generate average cost savings in harvesting and reseeding thereby promoting more intensive harvesting at the expense of environmental benefits

determinants of visitors willingness to pay for the national marine park of zakynthos greece abstract we examined the influence of visitors profile information sources environmental dispositions and visit evaluation on visitors willingness to pay wtp for the national marine park of zakynthos regarding wtp amounts pledged parameters of visit evaluation were the most significant predictors the estimated annual revenue that could be gained could cover the operating costs of the protected area management body visitor and visit characteristics were not significant determinants of visitor responses to the payment principle question while they explained a relatively small amount of variation in the wtp amount multiple regression model nationality was not a significant predictor of wtp all the same greek visitors showed more signs of pro environmental attitudes than foreign ones non use values dominated over use values and higher wtp amounts were associated with bequest value an alternative classification of the valuation system alleged to justify wtp is proposed where option value could be arranged together with use value components under the assumption that future use could still be regarded as another form of use value moreover existence and bequest values could be approached separately under the hypothesis that the former is expected to be associated with relatively lower wtp amounts pledged while the latter is expected to lead to relatively higher wtp amounts our study adds to the complexity and context dependency of wtp determinants park managers are suggested to organize environmental education programs that could decrease visitors consensus estimation error and act as a feedback through word of mouth information gained by friends and relatives

contingent valuation and the activation of environmental norms abstract this paper uses contingent valuation cvm as the context in which to explore the implications of a model of altruistic norm activation a model is presented which provides a framework for thinking about the factors that individuals consider when formulating their responses to cvm questions and the processes by which they bring such factors together the activation of personal environmental norms and hence positive willingness to pay depends on four main categories of belief awareness and acceptance of environmental need consequences of personal action responsibility for personal action and acceptance of policy initiatives the model is illustrated with a qualitative case study and some of the implications for cvm are considered in light of these findings it is argued that whilst notions of fairness may not present problems from a demand prediction economic standpoint such notions may be more problematic for the cost benefit analysis use of results

valuing public goods discrete versus continuous contingent valuation responses independent applications of open ended and dichotomous choice formats are compared using tests of means estimating joint likelihood functions and nonparametric tests of distributions the null hypothesis of no difference in the open ended and dichotomous choice estimates of central tendency cannot be rejected for two out of three data sets while estimated standard deviations are significantly different for all three data sets in addition actual dichotomous choice means and standard deviations exceed those from comparable synthetic dichotomous choice data sets suggesting either open ended questions underestimate values or dichotomous choice bid structures may lead to systematic overestimates

the relationship between the income elasticities of demand and willingness to pay abstract the relationship between income and willingness to pay for collectively provided public environmental goods is investigated we show that while the income elasticity of willingness to pay and the ordinary income elasticity of demand are related knowledge of one is insufficient to determine the magnitude or even the sign of the other the income elasticity of willingness to pay is influenced by additional factors which are generally unobservable examples are provided to illustrate the degree to which the two income elasticities may diverge our results indicate that even when goods are demand luxuries they may or may not have income elasticities of willingness to pay which are greater than one

savings rates and income distribution further evidence from ldcs a cross country test for the existence of kaldor effects in less developed countries is developed earlier attempts have been inconclusive and have led to a perception that the effect is unimportant it is argued that previous tests may have ben misspecified within a standard life cycle framework a savings rate function that also incorporates two distribution variables one involving measures of income inequalities across income classes and the other a broad measure of inequalities among sectors was specified and estimated the results indicate that regardless of the inequality measure employed some sort of kaldor effect may be at work this suggests that the traditional conflect between growth and equity warrants continued investigation

expected encounters and willingness to pay for outdoor recreation there is increasing interest in the management of natural resources for recreational activities much of it concerning the effect of crowding in outdoor recreation earlier work outlined models for estimating the effect of increased visitor contacts on individual willingness to pay for wilderness experiences cicchetti and smith 1973 others have looked at how crowding affects recreational resource valuation and criteria for the optimal management of recreational resources anderson and bonsor 1974 fisher and krutilla 1972 while the present paper is also concerned with the effect of visitor contacts on willingness to pay for outdoor recreation it differs from earlier work by looking at how individual willingness to travel is influenced by pre trip expectations of interparty encounters at the site we begin the paper by reviewing the related literature concerning user contacts and outdoor recreation the next section discusses the methods employed in this study and presents the empirical results based on data from the high peaks area of the adirondack mountains in new york state the final section discusses the results and our conclusions

a multilevel modelling approach to triple bounded dichotomous choice contingent valuation the use of dichotomous choice dc questions in the elicitation of willingness to pay wtp in contingent valuation studies is common practice at the present time recent research has shown that double bounded dc questions provide statistically superior results to single bounded questions given an appropriate sampling design this paper uses a relatively new multilevel modelling technique to analyze a triple bounded dc design which in addition includes an initial non monetary question on whether an individual accepts in principle a wtp some unspecified amount the theoretical basis of the multilevel model used is described and some of the possibilities of this potentially powerful and versatile technique are discussed the practical operation of the multilevel model is demonstrated using data from a contingent valuation study conducted in the norfolk broads england an internationally important wetland resource

measuring the existence value of wildlife what do cvm estimates really show two research programs are brought together to contribute to the growing body of work on alternatives to standard welfare based approaches to environmental valuation and policy the first is the theoretical literature undermining the new welfare

a contingent valuation estimate of the benefits of wolves in minnesota in this paper we estimate the willingness topay for a wolf management plan and a wolfdamage plan in minnesota using the contingentvaluation method the theoretical definition ofwillingness to pay for wolf protection iscomposed of use and non use values weincorporate a don t know response option in thedichotomous choice valuation questions a largenumber of respondents answered don t know themultinomial logit model is used todifferentiate between don t know and noresponses non use motives are importantfactors that explain willingness to pay we usethese benefit estimates in combination with twoalternative cost estimates to consider theefficiency of the wolf management and damageplans both plans have estimated benefitsgreater than costs