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What to Value and How? Ecological Indicator Choices in Stated Preference Valuation

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  • Minjuan Zhao
  • Robert Johnston
  • Eric Schultz

Abstract

The ecological literature accepts that many policy outcomes cannot be observed directly and must be characterized using indicators. Multiple indicators can often be used to communicate similar ecological outcomes. Previous studies using alternative indicators in stated preference surveys suggest that welfare estimates may be indicator-dependent, casting doubt on whether welfare estimates are sufficiently reliable for cost benefit analysis. We suggest that the reason for such indicator dependence may be that indicators used in these prior studies represented different outcomes valued by respondents. This possibility underscores the need for greater attention to selection of indicators and their properties within stated preference survey design. This paper develops a model introducing the concept of outcome equivalent indicators, defined as indicators that provide alternative representations of identical underlying outcomes. To assess empirically whether welfare estimates are indeed robust to indicator choice when alternative indicators are expected to be outcome equivalent, we analyze data from a choice experiment estimating willingness to pay for migratory fish restoration in Rhode Island, USA. Results demonstrate that welfare estimates are robust to the use of alternative ecological indicators within stated preference scenarios. Copyright Springer Science+Business Media Dordrecht 2013

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  • Minjuan Zhao & Robert Johnston & Eric Schultz, 2013. "What to Value and How? Ecological Indicator Choices in Stated Preference Valuation," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 56(1), pages 3-25, September.
    • Handle: RePEc:kap:enreec:v:56:y:2013:i:1:p:3-25
    DOI: 10.1007/s10640-013-9636-0
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    Cited by:

    1. Pascal da Costa & Daniel Hernandez, 2019. "The Economic Value of Ecosystem Conservation: A Discrete Choice Experiment at the Taravo River Basin in Corsica," Working Papers hal-01971681, HAL.
    2. Kristina Ek & Lars Persson, 2020. "Priorities and Preferences in Water Quality Management - a Case Study of the Alsterån River Basin," Water Resources Management: An International Journal, Published for the European Water Resources Association (EWRA), Springer;European Water Resources Association (EWRA), vol. 34(1), pages 155-173, January.
    3. Anders Dugstad & Kristine M. Grimsrud & Gorm Kipperberg & Henrik Lindhjem & Ståle Navrud, 2021. "Scope Elasticity of Willingness to pay in Discrete Choice Experiments," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 80(1), pages 21-57, September.
    4. Robert Johnston & Mahesh Ramachandran, 2014. "Modeling Spatial Patchiness and Hot Spots in Stated Preference Willingness to Pay," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 59(3), pages 363-387, November.
    5. Holland, Benedict M. & Johnston, Robert J., 2017. "Optimized quantity-within-distance models of spatial welfare heterogeneity," Journal of Environmental Economics and Management, Elsevier, vol. 85(C), pages 110-129.
    6. Holland, Benedict M. & Johnston, Robert J., 2015. "Capturing More Relevant Measures of Spatial Heterogeneity in Stated Preference Willingness to Pay: Using an Iterative Grid Search Algorithm to Quantify Proximate Environmental Impacts," 2015 AAEA & WAEA Joint Annual Meeting, July 26-28, San Francisco, California 205450, Agricultural and Applied Economics Association.
    7. Robert J. Johnston & Kevin J. Boyle & Maria L. Loureiro & Ståle Navrud & John Rolfe, 2021. "Guidance to Enhance the Validity and Credibility of Environmental Benefit Transfers," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 79(3), pages 575-624, July.
    8. Moeltner, Klaus & Puri, Roshan & Johnston, Robert J. & Besedin, Elena & Balukas, Jessica & Le, Alyssa, 2022. "Locally Weighted Meta-Regression and Benefit Transfer," 2022 Annual Meeting, July 31-August 2, Anaheim, California 322359, Agricultural and Applied Economics Association.
    9. Wainger, L. & Loomis, J. & Johnston, R. & Hansen, L. & Carlisle, D. & Lawrence, D. & Gollehon, N. & Duriancik, L. & Schwartz, G. & Ribaudo, M. & Gala, C., 2017. "Ecosystem Service Benefits Generated by Improved Water Quality from Conservation Practices," C-FARE Reports 260679, Council on Food, Agricultural, and Resource Economics (C-FARE).
    10. Windle, Jill & Rolfe, John, 2014. "Valuation framing and attribute scope variation in a choice experiment to asses the impacts of changing land use from agriculture to mining," 2014 Conference (58th), February 4-7, 2014, Port Macquarie, Australia 165888, Australian Agricultural and Resource Economics Society.
    11. Jensen, Anne Kejser, 2019. "A Structured Approach to Attribute Selection in Economic Valuation Studies: Using Q-methodology," Ecological Economics, Elsevier, vol. 166(C), pages 1-1.
    12. Holland, Benedict M. & Johnston, Robert J., 2014. "Spatially-Referenced Choice Experiments: Tests of Individualized Geocoding in Stated Preference Questionnaires," 2014 Annual Meeting, July 27-29, 2014, Minneapolis, Minnesota 170191, Agricultural and Applied Economics Association.
    13. Ahi, Jülide Ceren & Aanesen, Margrethe & Kipperberg, Gorm, 2023. "Testing the sensitivity of stated environmental preferences to variations in choice architecture," Ecological Economics, Elsevier, vol. 205(C).

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