INCENTIVE COMPATIBLE REFERENDA AND THE VALUATION OF ENVIRONMENTAL GOODS

Recent attempts to test the validity of the contingent valuation method have relied on laboratory-type experiments. In these experiments, willingness to pay responses in hypothetical choice experiments are compared with responses from choice experiments requiring actual payments. Often evidence of hypothetical bias is found. Critical for these experimental tests of hypothetical surveys is that the methodology used to elicit willingness to pay from subjects in the real-payment experiment be demand revealing. If it is not, then differences in responses to hypothetical and real valuation questions could be due to free-riding in the real-payment survey and not due to hypothetical bias in the hypothetical survey. This paper reports on experiments that implement a theoretically incentive-compatible revelation mechanism (a closed referendum) to elicit responses to valuation questions in both hypothetical and real experiments. As in earlier studies, evidence of an upward hypothetical bias is found.Environmental Economics and Policy,

Use Permits: A Hedonistic Approach Applied to Farmland in the Southeastern US

In the State of Georgia, any agricultural producer who wishes to pump more than 100,000 gallons of water a day for crop irrigation is required to have an irrigation permit. The permit stays with the land and in the event of sale the permit is transferred with the property. Until recently, permits were essentially granted freely to all applicants in the Flint River water basin, without limit. In 1999, however, with increasing demand for water from growing urban Atlanta and several years of drought in the Southeast, the state of Georgia placed a moratorium on the issuance of agricultural water permits in the Flint River basin. This research exploits this policy change within a hedonic pricing framework to estimate the value of irrigation rights in the Southeast US. While the value of irrigation rights has been studied extensively in the western US, differences in property rights and legal regimes, as well as a lack of established water-rights markets in the East, leave us with little information regarding the value of irrigation rights in this setting. Working Paper 06-4

Short distance signatures in Cosmology: Why not in Black Holes?

Current theoretical investigations seem to indicate the possibility of observing signatures of short distance physics in the Cosmic Microwave Background spectrum. We try to gain a deeper understanding on why all information about this regime is lost in the case of Black Hole radiation but not necessarily so in a cosmological setting by using the moving mirror as a toy model for both backgrounds. The different responses of the Hawking and Cosmic Microwave Background spectra to short distance physics are derived in the appropriate limit when the moving mirror mimics a Black Hole background or an expanding universe. The different sensitivities to new physics, displayed by both backgrounds, are clarified through an averaging prescription that accounts for the intrinsic uncertainty in their quantum fluctuations. We then proceed to interpret the physical significance of our findings for time-dependent backgrounds in the light of nonlocal string theory.Comment: 10 pages, 2 figures, REVTeX 4 styl

Postcards from the NSF

We provide an overview of the workings of the National Science Foundation and the proposal review process, as well as some guidance in writing proposals for funding.NSF, National Science Foundation, proposals, review process

Postcards from the NSF

We provide an overview of the workings of the National Science Foundation and the proposal review process, as well as some guidance in writing proposals for funding.

Using Meta Analysis for Benefits Transfer: Theory and Practice

Meta-analysis, or the "study of studies", attempts to statistically measure systematic relationships between reported valuation estimates for an environmental good or service and attributes of the study that generated the estimates including valuation methods, human population and sample characteristics, and characteristics of the good or service itself. In this paper, we discuss the general theory behind and practice of the emerging use of meta-analysis for benefits transfer. If carefully conducted following systematic protocols for model development, data collection, and data analysis and interpretation, we believe that meta-analysis may prove to be a useful tool for benefits transfer in particular applications. However, before widespread application of this method, more convergent validity tests are needed. One of the greatest strengths of using meta-analysis for benefits transfer is the ability to combine and summarize large amounts of information from previous studies. This strength can also lead to one of the greatest weaknesses of this method which is the loss of important valuation details across time and space in the aggregation process. Thus, application of this method to policy questions and issues should always proceed with caution.

Altruism Spillovers: Are Behaviors in Context-Free Experiments Predictive of Altruism Toward a Naturally Occurring Public Good?

This paper addresses the external validity of experiments investigating the characteristics of altruism in the voluntary provision of public goods. We conduct two related experiments that allow us to examine whether individuals who act more altruistically in the context-free environment are also more likely to act altruistically toward a naturally-occurring public good. We find that laboratory behavior can be predictive of contributions toward naturally-occurring goods, but not in a uniform way. In fact, parametric measures of altruism do a poor job of predicting which subjects are most likely to contribute to a naturally-occurring public good.

Developing Offset Banking Systems in Georgia

Offset banking involves a public or private entity investing in a project that has the effect of substantially reducing a targeted pollutant(s), such as sediment runoff, phosphorus, heavy metals, etc. This project is referred to as "the bank." The entity creating the bank receives "credits" for the associated reduction in pollutants, which it can then sell to publically-owned treatment works (POTWs) or other point source polluters facing high costs of meeting discharge standards. Trades can be allowed on a 1-to-1 basis: the buyer obtains one credit for each creditequivalent increase in pollution associated with his/her activities; or higher trading ratios can be required, e.g., 3:1, where the buyer must acquire (in this example) three credits for each creditequivalent increase in pollution associated with his/her activities. In this latter case trades result in actual environmental improvements.This paper addresses two major issues. The first refers to the steps required to establish a pilot project for one or more offset banking projects in Georgia. These steps are: identifying entities with incentives to purchase offset credits; identifying one or more entities that might establish a bank, and potential bank sites; establishing trading rules with appropriate local water quality management authorities; and obtaining approval of the proposed trading program from the U.S. EPA.The second major issue addressed in the paper is means by which an offset bank might be created. For this purpose, a brief survey is offered of existing water quality trading projects in the U.S.. Buyers of offset credits are virtually always point-source polluters (POTWs or industries). Point and non-point projects have been used as "banks" -- as a source for offset banking credits. Attention in this paper is focused on non-point sources that might serve as banks for pilot offset banking projects in Georgia. Both low- and high-technology alternatives that might be used for such projects are discussed.Notwithstanding incentive-related limitations on the number of point source polluters that might constitute the "demand" for offset credits discussed in section II, the authors have identified one entity (Fulton County) that may represent significant demand for credits, and they expect to identify others. Moreover, the authors argue that continued growth in Georgia, particularly in the Atlanta and Coastal areas of the State, will give rise to sufficient numbers of point source entities seeking new discharge permits to warrant interest in offset banking as a means of meeting increasingly stringent discharge restrictions at minimum cost. If or when enforcement of TMDLs gains strength in the State, needs for systems like offset banking will increase accordingly. These considerations, and the associated benefits to Georgians that might attend the establishment of offset banking programs in the State, serve as the rationale for the author's continued interest in exploring means by which pilot offset banking projects can be established in Georgia. Working Paper # 2003-00