The Combinatorial World (of Auctions) According to GARP

Revealed preference techniques are used to test whether a data set is compatible with rational behaviour. They are also incorporated as constraints in mechanism design to encourage truthful behaviour in applications such as combinatorial auctions. In the auction setting, we present an efficient combinatorial algorithm to find a virtual valuation function with the optimal (additive) rationality guarantee. Moreover, we show that there exists such a valuation function that both is individually rational and is minimum (that is, it is component-wise dominated by any other individually rational, virtual valuation function that approximately fits the data). Similarly, given upper bound constraints on the valuation function, we show how to fit the maximum virtual valuation function with the optimal additive rationality guarantee. In practice, revealed preference bidding constraints are very demanding. We explain how approximate rationality can be used to create relaxed revealed preference constraints in an auction. We then show how combinatorial methods can be used to implement these relaxed constraints. Worst/best-case welfare guarantees that result from the use of such mechanisms can be quantified via the minimum/maximum virtual valuation function

Review of river fisheries valuation in West and Central Africa

This paper provides a review of the valuation of river fisheries in West and Central Africa. It is the general perception that, compared to the biological and ecological aspects of river fisheries, this particular subject area has received relatively little attention. Economic valuation is concerned with finding expression for what is important in life for human society. It should, therefore, be a central and integral part of government decision-making and policy. The review started with concepts and methods for valuation. Three main types of valuation techniques were identified: conventional economic valuations, economic impact assessments and socioeconomic investigations, and livelihood analysis. On the basis of a literature review, valuation information was then synthesized for the major regional river basins and large lakes, and also used to develop a series of national fisheries profiles. To supplement this broad perspective, a series of case studies are also presented, which focus in particular on the impact of changes in water management regime. Finally, the paper presents an assessment of the three main types of valuation methodology and a set of conclusions and recommendations for future valuation studies

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

MEASURING CONSUMER BENEFITS OF FOOD SAFETY RISK REDUCTIONS

Microbial pathogens and pesticide residues in food pose a financial burden to society which can be reduced by incurring costs to reduce these food safety risks. We explore three valuation techniques that place a monetary value on food safety risk reductions, and we present a case study for each: a contingent valuation survey on pesticide residues, an experimental auction market for a chicken sandwich with reduced risk of Salmonella, and a cost-of-illness analysis for seven foodborne pathogens. Estimates from these techniques can be used in cost/benefit analyses for policies that reduce food safety risks.Contingent valuation, Cost of illness, Experimental auction market, Food safety, Risk reduction, Salmonella, Food Consumption/Nutrition/Food Safety,

An economist looks at ecosystem services

This chapter lists ecosystem services and discusses what techniques can be applied in order to assess their economic value. The last five decades witnessed enormous progress in developing valuation techniques applied to non-market goods (i.e. the goods that do not have market prices). These can be broadly divided into direct and indirect techniques. The former aim at capturing them directly e.g. by asking people “how much they are willing to pay”. The latter derive values from observing prices not for the good of interest, but rather for a complementary good whose characteristics shed some light on peopleʼs relevant preferences. These techniques were successfully tested in many regions of the world, including Poland. The best known exercise of this sort is the one published by Nature in 1997, where an attempt was made to estimate the global economic value of annual ecosystem services. Numerous subsequent studies have allowed for much more accurate assessments. Consequently, researchers addressing valuation problems have an extensive accumulated research experience to rely on.Wydanie współfinansowane ze środków Miasta Łodzi w ramach zadania “Współpraca z wyższymi uczelniami” – umowa 100/03/201

Toward Integrated Urban Agricolture Systems: Economic and Valuation Aspects

The Paper defines an integrated urban agriculture system (A-URBIS), outlining the complications associated with its launching and implementation, and a methodological guidelines for the valuation of an A-URBIS, taking into account the inclusive and qualitative impacts on the community. Finally the Paper proposes a Direct Deliberative Monetary Valuation procedure which derives from the combination of a participatory deliberative process, which is necessary to develop instruments of direct democracy, and Stated Preference Techniques, which are essential to capture the value related to inclusive use

Application of the travel cost method to estimate the economic value of cultural goods: Blockbuster art exhibitions

In recent years a growing number of studies have started to apply non-market valuation methods to estimate the economic value of cultural goods. The majority of these studies use stated preference techniques, such as the contingent valuation method. This study discusses the application of the travel cost method to estimate the economic value of a specific type of cultural good: special exhibitions. The empirical work focuses on the touring exhibition the ‘Ages of Mankind’, one of the first and most representative examples of a blockbuster art exhibition in Spain. This is the first time, as far as we know, that this method has been applied to a large temporary exhibition and is one of the few applications of this method in the valuation of cultural goods.Blockbuster arts exhibitions, non-market valuation, revealed preferences, travel cost method, cultural economics.

Capital budgeting under relational contracting: optimal ranking and duration criteria for schemes of concession, project-financing and public-private partnership

Project-financing and public-private partnership schemes are joint projects of investment that are generally submitted to investment valuation criteria based on compound discounting. However, the theoretical basis of these criteria is at issue nowadays. According to recent studies on relational contracting economics and behavioral finance, joint projects of investment can be considered as special relational environments where the project's returns improve on alternative replacement opportunities. This article aims to bridge the gap between new theories and widespread valuation techniques by providing a generalised approach to investment valuation. This article suggests new valuation criteria that fit those theoretical developments, including an endogenous optimal duration that the project's contractual agreement may integrate.discounting; investment decision criteria; capital budgeting; project finance and public private partnerships; endogenous optimal duration; cost of capital for government

Measuring the Economic and Cultural Values of Historic Heritage Places

This research project on the valuation of cultural heritage is developing a methodology for a quantitative valuation study of the use and non-use values of historic heritage places. The methodology developed in this project will provide a template for subsequent empirical applications to generate data of use in the formulation of heritage policies and programs. The initial stages in reaching this larger objective have involved determining how historic heritage places are to be categorised for measurement, establishing the process by which heritage attributes will be determined for valuation, and developing and trialling an effective measurement framework. The principal techniques being developed for valuation assessment in the project are derived from choice-modelling (CM) and contingent-valuation methods (CVM). A particular focus of the project is on the systematic integration of cultural and economic value assessments within a consistent theoretical framework, reflecting the need for an economic perspective on the significance criteria currently in use in heritage policy in Australia.Community/Rural/Urban Development, Environmental Economics and Policy,