Contingent Valuation Methods.Possibilities and Problems

Valuation of external costs created from transport is important to undertake in order to improve the decision-making basis for transport policy. In particular, this information could be utilised with respect to policy measures for the internalisation of external costs as well as with respect to appraisal of specific transport investment projects. A number of methods towards the valuation of external costs have appeared in recent years in parallel with the increased awareness about the environmental problems created by transport. These methods include approaches based on assessing the resources required to reduce the costs as well as utility-based approaches. In particular, the so-called contingent valuation method has been put forward as a way to determine the willingness to pay for various environmental goods/functions for a sample of individuals. This method has been applied in a wide range of empirical context in the last two decades. This paper will provide a critical assessment of contingent valuation methods. In particular, the paper will consider the theoretical and empirical possibilities and problems provided by this method. The paper will include the following sections. Section 1 will identify the need to valuate external costs. In section 2 an overview of contingent valuation methods will be given. This will be followed in section 3 by an examination of the possibilities and problems involved in this method. Section 4 concludes with final remarks and suggestions for further research to improve the method.Externality valuation, Monetarisation, Contingent valuation method

The Provision Point Mechanism and Scenario Rejection in Contingent Valuation

The provision point mechanism mitigates free-riding behavior in economic experiments. In two contingent valuation method surveys, we implement the provision point design. We ask respondents for their perceptions about the success of the provision point mechanism. We find that respondents who believe that the provision point would not be met are more likely to say no to a contingent valuation dichotomous choice question. The scenario rejection that arises may result in biased willingness-to-pay estimates.provision point mechanism, contingent valuation, willingness to pay, public goods, Environmental Economics and Policy,

The "more is less" phenomenon in Contingent and Inferred valuation

2011) using the Contingent valuation (CV) as well as the Inferred valuation (IV) method (Lusk and Norwood 2009b). We find that when moving in the context of a familiar market for consumers (i.e., the food market) we only observe weak effects of inconsistencies. In addition, we find that the IV method is no better (and no worse) than the CV method in generating more consistent preference orderings. Surprisingly, we also find that the IV method generates higher valuations than CV, rendering one of its advantages of mitigating social desirability bias questionable.willingness-to-pay (WTP), Contingent Valuation (CV), Inferred Valuation(IV), preference reversals, Resource /Energy Economics and Policy, C9, C93, D12, Q51,

The Contingent Valuation Method: Retrospect and Prospect

This paper explores the contingent valuation method for environmental valuation. Issues are raised over the validity of the approach as a method of assessing the underlying preferences of individuals. An alternative interpretation is given to the method as a means of exploring underlying motivation in a rich vein of social psychological research.stated preferences, environmental values, social psychology

Better than their reputation - A case for mail surveys in contingent valuation

Though contingent valuation is the dominant technique for the valuation of public projects, especially in the environmental sector, the high costs of contingent valuation surveys prevent the use of this method for the assessment of relatively small projects. The reason for this cost problem is that typically only contingent valuation studies which are based on face-to-face interviews are accepted as leading to valid results. Especially in countries with high wages face-to-face surveys are extremely costly considering that for a valid contingent valuation study a minimum of 1,000 completed face-to-face interviews is required. In this paper we try a rehabilitation of mail surveys as low-budget substitutes for costly face-to-face surveys. Based on an empirical contingent valuation study in Northern Thailand we show that the validity of mail surveys can be improved significantly if so-called citizen expert groups are employed for a thorough survey design.contingent valuation; Environmental Valuation; Equity

Social ex-post evaluation of local development programs: application of a contingent valuation approach to the Guadix-Marquesado LEADER area (Spain)

As part of the evaluation of the activity of a district’s local development group (LAG), valuation by local society could be a potential element of interest. In this paper we present a social valuation of the LAG activity in the Guadix-Marquesado district (south-eastern Spain), where the contingent valuation method is one of the analytical elements used. A number of results show how the LAG has now become part the institutional network closest to local society, which values the increased welfare that its activity generates slightly more than its actual annual operating expenses. This somehow socially legitimizes the public funding it receives. Other results pertaining to change perception, familiarity with LAG activities and the scalar valuation of its social impact are also included.Social evaluation, Rural development, Contingent valuation method, Willingness to pay., Agricultural and Food Policy, O43, R11,

Economic Valuation of Environmental Values of the Landscape Development and Protection Area of Volcji Potok

When the market for a certain good is competitive enough, economic activities can be studied by the market pricing mechanism. Because this is usually not feasible in case of environmental goods with embodied natural and cultural heritage, particular methods for economic valuation of such goods have to be applied. The present article represents the economic valuation of the Landscape Development and Protection Area of Vol誩 Potok, which is an important Slovenian cultural landscape area with internationally recognized characteristics. For this purpose we have chosen the method of contingent valuation and performed an econometric analysis of stated and true willingness-to-pay. We obtained the value of willingness-to-pay and determined its determinants. We also made an attempt to control for different biases that arise in such analyses. At last, we used the adjusted average individual value of willingness-to-pay to calculate the aggregate willingness-to-pay.bivariate probit model; contingent valuation method; discrete choice method; embedding effects; environmental values; starting point bias; willingness-to-pay

Respondent incentives in contingent valuation: The role of reciprocity

--public expenditures,environmental valuation,cost-benefit analysis,contingent valuation method,respondent incentives,reciprocity,reforestation

The economic value of biodiversity in New Zealand: Results from a household survey

This paper presents the results of a national study examining the economic value of biodiversity in New Zealand. Three valuation techniques were used to collect information from respondents: the contingent valuation method, the well-being method and the choice modelling method. Results revealed that respondents were familiar with the native plants and animals in their areas and valued them highly, therefore having a strong value for native biodiversity

A direct test of socially desirable responding in contingent valuation interviews

--environmental valuation,contingent valuation method,socially desirable responding,loss aversion,reforestation