Spike Models in Contingent Valuation

Spike models allow for a nonzero probability of zero willingness to pay in referendum-style contingent valuation experiments. They include many of the often used models as special cases and allow various analyses that are not possible in standard applications. In this paper, the economic rationale for the spike models and their estimation techniques are discussed, and empirical illustrations are provided. One study suggests that mean willingness to pay is zero, and both studies strongly suggest that median WTP is zero. These results have some bearing on the continuing debate of the incentive properties of hypothetical surveys and the construction of scenarios in contingent valuation experiments. Copyright 1997, Oxford University Press.

Welfare Measurement in Single and Multimarket Models: Theory and Application

In this paper we provide an analysis of tax reforms along the lines of the multimarket welfare measurement techniques suggested by Just, Hueth, and Schmitz. A key purpose of our analysis is to shed light on the approximating features of partial equilibrium models. We derive a result on the difference between single and multimarket welfare measurement, showing how the difference boils down to a set of key parameters. We use our approach to analyze a proposal put forward by the Swedish Commission of Environmental Charges regarding chlorine emissions from the Swedish pulp and paper industry. Copyright 1996, Oxford University Press.

The equity-efficiency trade-off in environmental policy: evidence from stated preferences

The design of environmental policy raises several equity issues, in particular the distribution of benefits and costs. At the same time, it has often been argued that there is a trade-off in environmental policy between equity and efficiency, which brings these issues firmly to the attention of environmental economics. In this paper we use a simple choice experiment to elicit individual preferences over equity-efficiency trade-offs in the context of two environmental problems, local air pollution and global climate change. We find that equity matters to people as much as efficiency does in the design and delivery of environmental policy