Meta-analysis of nature conservation values in Asia & Oceania: Data heterogeneity and benefit transfer issues

We conduct a meta-analysis (MA) of around 100 studies valuing nature conservation in Asia and Oceania. Dividing our dataset into two levels of heterogeneity in terms of good characteristics (endangered species vs. nature conservation more generally) and valuation methods, we show that the degree of regularity and conformity with theory and empirical expectations is higher for the more homogenous dataset of contingent valuation of endangered species. For example, we find that willingness to pay (WTP) for preservation of mammals tends to be higher than other species and that WTP for species preservation increases with income. Increasing the degree of heterogeneity in the valuation data, however, preserves much of the regularity, and the explanatory power of some of our models is in the range of other MA studies of goods typically assumed to be more homogenous (such as water quality). Subjecting our best MA models to a simple test forecasting values for out-of-sample observations, shows median (mean) forecasting errors of 24 (46) percent for endangered species and 46 (89) percent for nature conservation more generally, approaching levels that may be acceptable in benefit transfer for policy use. We recommend that the most prudent MA practice is to control for heterogeneity in regressions and sensitivity analysis, rather than to limit datasets by non-transparent criteria to a level of heterogeneity deemed acceptable to the individual analyst. However, the trade-off will always be present and the issue of acceptable level of heterogeneity in MA is far from settle

Income Inequality and Willingness to Pay for Public Environmental Goods

We study how the distribution of income among members of society, and income inequality in particular, affects social willingness to pay (WTP) for environmental public goods. We find that social WTP for environmental goods increases with mean income, and decreases (increases) with income inequality if and only if environmental goods and manufactured goods are substitutes (complements). Furthermore, social WTP for environmental normally changes more elastically with mean income than with income inequality. We derive adjustment factors for benefit transfer to control for differences in income distributions between a study site and a policy site. For illustration, we quantify how social WTP for environmental public goods depends on the respective income distribution for empirical case studies in Sweden, China and the World. We find that the effects of adjusting for income inequality can be substantial

A Novel Approach to Estimating the Demand Value of Road Safety

We estimate the demand value of road safety improvements in Switzerland from survey data using a novel elicitation approach. Individuals’ responses to questions about how much public spending on road safety should be increased are combined with observations of income, tax rate, and road usage to estimate the economic value of a statistical accident avoided. Information obtained from a risk-risk tradeoff elicitation allows us to distinguish willingness-to-pay values for various degrees of accident severity. Our most comprehensive estimate of the value of a statistical accident avoided amounts to CHF 11.0 million ($11.6 million); the corresponding value per statistical life is close to CHF 4.2 million ($4.5 million). We explore the sensitivity of these estimates to anchoring and other framing effects and find that the popularity of specific road safety programs is influenced by both the availability of different choice options and the provision of partisan cues expressing political endorsement or opposition