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The value of preserving nature: Preference uncertainty and distributional effects
Umeå University, Faculty of Social Sciences, Department of Economics.
2007 (English)Doctoral thesis, comprehensive summary (Other academic)
Abstract [en]

This thesis deals with valuation of nonmarket goods using contingent valuation and consists of four papers and an introduction to the research area.

Paper [I] examines the public benefits from preserving old-growth forest in the sub-mountainous region in Sweden. Specifically, it analyzes a preservation program suggested by the Swedish Environmental Protection Agency. The results show that people value preservation for different reasons, not necessarily related to physical use. The paper finds that the estimated public benefits of the program exceed the estimated opportunity cost of forgone timber revenues and it should therefore be implemented. The paper also finds that there is no regional imbalance in the distribution of the benefits.

Paper [II] examines the public benefits from preserving the four large predators in the Swedish fauna. Specifically, the paper focuses on the differences in attitudes and willingness to pay between people in wolf areas and other regions. We find that a clear majority of people in wolf areas are against preserving predators and that many of them need to be economically compensated in order to accept implementation of the predator policy package. The public in Sweden is, by a narrow margin, against implementation. The overall mean WTP is approximately SEK 300. It cannot be ruled out that the public benefits may be outweighed by the public costs following implementation.

Paper [III] presents a new approach for treating preference uncertainty in contingent valuation. Specifically, it studies how data elicited from a multiple bounded question should be modelled. The new approach is compared to one of the conventional approaches and we find that: (1) it is more intuitive; (2) it better fits the data; (3) it gives more precise estimates of mean and median WTP; (4) it is less sensitive to distributional assumptions; and (5) it is better suited for policy analysis.

Paper [IV] examines the income-effect in contingent valuation. Specifically three issues are analyzed: (1) the choice of income measure; (2) the choice of modelling assumptions; and (3) the social context. The results show that the estimated income-elasticity of WTP is fairly sensitive to different choices. The most statistically precise estimate is produced using household income and controlling for household characteristics. The third issue (social context) is approached by studying the answers to a WTP question conditioning respondents on a change in (1) their personal income and (2) the average income in Sweden. The results suggest that not only the income level per se influences WTP, but also its relation to the income of others.

Keywords: contingent valuation, nonuse values, preference uncertainty, income-effect.

Place, publisher, year, edition, pages
Umeå: Nationalekonomi , 2007. , 119 p.
Series
Umeå economic studies, ISSN 0348-1018 ; 720
National Category
Economics
Identifiers
URN: urn:nbn:se:umu:diva-1431ISBN: 9789172644472 (print)OAI: oai:DiVA.org:umu-1431DiVA: diva2:141033
Public defence
2007-12-06, N200, Naturvetarhuset, Umeå Universitet, Umeå, 10:15 (English)
Opponent
Supervisors
Available from: 2007-11-13 Created: 2007-11-13 Last updated: 2009-11-06Bibliographically approved
List of papers
1. The value of old-growth forests in Sweden
Open this publication in new window or tab >>The value of old-growth forests in Sweden
Article in journal (Refereed) Submitted
Identifiers
urn:nbn:se:umu:diva-2764 (URN)
Available from: 2007-11-13 Created: 2007-11-13Bibliographically approved
2. On the value of large predators in Sweden: a regional stratified contingent valuation analysis
Open this publication in new window or tab >>On the value of large predators in Sweden: a regional stratified contingent valuation analysis
2007 (English)In: Journal of Environmental Management, ISSN 0301-4797, E-ISSN 1095-8630, Vol. 88, no 4, 1066-1077 p.Article in journal (Refereed) Published
Abstract [en]

This paper contributes with an applied policy analysis of the predator preservation policy in Sweden. We estimate the overall mean willingness to pay (WTP) for preserving the four large predators in the Swedish fauna by applying the contingent valuation method. Using survey data from 2004 we find that 50 percent of the Swedish population is willing to contribute financially toward implementation of the predator policy package, and that the estimated overall mean WTP is approximately SEK 290. Further, we test for spatial differences in attitudes and WTP and find that respondents in Stockholm have the highest overall mean WTP, while respondents living in wolf-territories have the lowest. Our mean WTP measure is flawed with upward bias, since we cannot estimate the willingness to accept for those with clearly negative preferences regarding the predator policy package (e.g. hunters). In this paper, we set their WTP equal to zero. Thus, we cannot rule out the possibility that the mean willingness to pay is, in fact, negative, i.e. the social-value of implementing the predator policy is negative. Finally, the estimates of the overall WTP are sensitive to response-uncertainty. When the respondents indicate uncertainty about their valuation, they tend to state higher values.

Keyword
Willingness to pay, Contingent valuation, Predators, Policy analysis
National Category
Economics
Research subject
Economics
Identifiers
urn:nbn:se:umu:diva-16497 (URN)10.1016/j.jenvman.2007.05.016 (DOI)
Available from: 2008-06-19 Created: 2008-06-19 Last updated: 2017-12-14Bibliographically approved
3. A new approach for analyzing multiple bounded WTP data - Certainty dependent payment card intervals.
Open this publication in new window or tab >>A new approach for analyzing multiple bounded WTP data - Certainty dependent payment card intervals.
2007 (English)Report (Other academic)
Series
Umeå Economic Studies, 714
National Category
Economics
Research subject
Economics
Identifiers
urn:nbn:se:umu:diva-16498 (URN)
Available from: 2007-10-04 Created: 2007-10-04 Last updated: 2009-10-29Bibliographically approved
4. Examining the income-effect in contingent valuation: The importance of making the right choices
Open this publication in new window or tab >>Examining the income-effect in contingent valuation: The importance of making the right choices
2007 In: Umeå economic studies, ISSN 0348-1018, no 723Article in journal (Refereed) Published
Identifiers
urn:nbn:se:umu:diva-2767 (URN)
Available from: 2007-11-13 Created: 2007-11-13Bibliographically approved

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Citation style
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