Using Internet in Stated Preference Surveys: A Review and Comparison of Survey Modes

Internet is quickly becoming the survey mode of choice for stated preference (SP) surveys in environmental economics. However, this choice is being made with relatively little consideration of its potential influence on survey results. This paper reviews the theory and emerging evidence of mode effects in the survey methodology and SP literatures, summarizes the findings, and points out implications for Internet SP practice and research. The SP studies that compare Internet with other modes do generally not find substantial difference. The majority of welfare estimates are equal; or somewhat lower for the Internet surveys. Further, there is no clear evidence of substantially lower quality or validity of Internet responses. However, the degree of experimental control is often low in comparative studies across survey modes, and they often confound measurement and sample composition effects. Internet offers a huge potential for experimentation and innovation in SP research, but when used to derive reliable welfare estimates for policy assessment, issues like representation and nonresponse bias for different Internet panels should receive more attention.Internet; survey mode; contingent valuation; stated preferences

Can cheap panel-based internet surveys substitute costly in-person interviews in CV surveys?

With the current growth in broadband penetration, Internet is likely to be the data collection mode of choice for stated preference research in the not so distant future. However, little is known about how this survey mode may influence data quality and welfare estimates. In a first controlled field experiment to date as part of a national contingent valuation (CV) survey estimating willingness to pay (WTP) for biodiversity protection plans, we assign two groups sampled from the same panel of respondents either to an Internet or in-person (in-house) interview mode. Our design is better able than previous studies to isolate measurement effects from sample composition effects. We find little evidence of social desirability bias in the in-person interview setting or satisficing (shortcutting the response process) in the Internet survey. The share of “don’t knows”, zeros and protest responses to the WTP question with a payment card is very similar between modes. Equality of mean WTP between samples cannot be rejected. Considering equivalence, we can reject that mean WTP from the in-person sample is more than 30% higher. Results are quite encouraging for the use of Internet in CV as stated preferences do not seem to be significantly different or biased compared to in-person interviews.Internet; contingent valuation; interviews; survey mode; willingness to pay

Benefit Transfer – The Quick, the Dirty, and the Ugly?

Environmental Economics and Policy,

How Reliable are Meta-Analyses for International Benefit Transfers?

Meta-analysis has increasingly been used to synthesise the environmental valuation literature, but only a few test the use of these analyses for benefit transfer. These are typically based on national studies only. However, meta-analyses of valuation studies across countries are a potentially powerful tool for benefit transfer, especially for environmental goods where the domestic literature is scarce. We test the reliability of such international meta-analytic transfers, and find that even under conditions of homogeneity in valuation methods, cultural and institutional conditions across countries, and a meta-analysis with large explanatory power, the transfer errors could still be large. Further, international meta-analytic transfers do not on average perform better than simple value transfers averaging over domestic studies. Thus, we question whether the use of meta-analysis for practical benefit transfer achieves reliability gains justifying the increased effort. However, more meta-analytic benefit transfer tests should be performed for other environmental goods and other countries before discarding international meta-analysis as a tool for benefit transfer.benefit transfer, environmental valuation, meta-analysis, forest

Valuing forest recreation on the national level in a transition economy: The case of Poland

Recreation benefits constitute a substantial part of the total economic value of forests, and are important for the choice of multi-functional forest policies. The application of methods valuing such benefits is in its infancy in transition economies in Central and Eastern Europe (CEE), so value estimates for policy use are sometimes transferred from Western Europe proportionally scaled down by GDP. However, little is known about how recreation values vary with income, and one risks underestimating benefits in CEE. This paper reports the findings of the first comprehensive, national-level study in any CEE country estimating annual and per trip forest recreation values in Poland using the Travel Cost (TC) and Contingent Valuation (CV) methods. Two in-person interview surveys of forest recreation behaviour were carried out. The first was administered onsite in ten representative forest areas, and the other in the homes of a national sample of adult Poles. Results show that forest recreation is highly valued in Poland, at Euros 0.64 – 6.93 per trip per person, depending on the valuation method. Both trip frequency and per trip values are higher than the average in Western Europe, despite a lower income level. Thus, a simple GDP-adjusted transfer from Western Europe would substantially undervalue forest recreation in Poland. Further, a comparison of TC consumer surplus estimates and GDP/capita in Europe shows no clear relationship, indicating that a range of cultural, institutional and other factors may be importantForest, recreation, valuation, transition economy

What Do Respondents Bring to Contingent Valuation? A Comparison of Monetary and Labor Payment Vehicles

With contingent valuation, both the goods being valued and the payment vehicles used to value them are mostly hypothetical. However, although numerous studies have examined the impact of experience with the good on willingness to pay, less attention has been given to experience with payment vehicles. This paper examines how this influences responses to a contingent valuation scenario of maintenance for irrigation canals. Specifically, the paper uses a split-sample survey to investigate the effects of experience with monetary and labor payment vehicles on the acceptance of a contingent valuation scenario and protest bids. Using convergent validity tests, we found that experience acquired from using both monetary and labor payment vehicles reduces the asymmetries in acceptance rates. These findings suggest that experience with payment vehicles reduces time/money response asymmetries in the contingent valuation method.contingent valuation, payment vehicles, numéraires, experience

The External Cost of European Crude Oil Imports

This paper is the first to assess operational and probabilistic externalities of oil extraction and transportation to Europe on the basis of a comprehensive evaluation of realistic future oil demand-supply scenarios, of the relative relevance of import routes, of the local specificities in terms of critical passages and different burdens and impacts along import routes. The resulting externalities appear reasonable both under the assumption of high future demand and under low demand. Estimates range from 2.32 Euro in 2030 in the low demand scenario to 2.60 Euro in 2010 in the high demand scenario per ton of imported oil.Oil Transport, Externalities Oil Spills, Risk Analysis

Measuring the health effects of air pollution : to what extent can we really say people are dying from bad air?

Estimation of the effects of environmental impacts is a major focus of current theoretical and policy research in environmental economics. Such estimates are used to set regulatory standards for pollution exposure; design appropriate environmental protection and damage mitigation strategies; guide the assessment of environmental impacts; and measure public willingness to pay for environmental amenities. It is a truism that the effectiveness of such strategies depends crucially on the quality of the estimates used to inform them. However, this paper argues that in respect to at least one area of the empirical literature - the estimation of the health impacts of air pollution using daily time series data - existing estimates are questionable and thus have limited relevance for environmental decision-making. By neglecting the issue of model uncertainty - or which models, among the myriad of possible models researchers should choose from to estimate health effects - most studies overstate confidence in their chosen model and underestimate the evidence from other models, thereby greatly enhancing the risk of obtaining uncertain and inaccurate results. This paper discusses the importance of model uncertainty for accurate estimation of the health effects of air pollution and demonstrates its implications in an exercise that models pollution-mortality impacts using a new and comprehensive data set for Toronto, Canada. The main empirical finding of the paper is that standard deviations for air pollution-mortality impacts become very large when model uncertainty is incorporated into the analysis. Indeed they become so large as to question the plausibility of previously measured links between air pollution and mortality. Although applied to the estimation of the effects of air pollution, the general message of this paper - that proper treatment of model uncertainty critically determines the accuracy of the resulting estimates - applies to many studies that seek to estimate environmental effects

Scope sensitivity tests for preference robustness: An empirical examination of economic expectations regarding the economic valuation of politices for reducing acidity in remote mountain lakes

The paper introduces the reader to the contingent valuation method for monetary valuation of individuals preferences regarding changes to environmental goods. Approaches to the validity testing of results from such studies are discussed. These focus upon whether findings conform to prior expectations, in particular regarding whether valuations are sensitive to the size (or scope) of change being considered and whether they are invariant to changes in study design which are irrelevant from the perspective of economic theory. We apply such tests to a large sample study of two possible changes to the acidity levels of remote mountain lakes. Results suggest that robust values can be observed for a policy which would prevent further acidification of such lakes, but that values associated with measures to reduce acidity below present levels fail validity tests. Interestingly, values associated with preventing further acidification of lakes appear to be significantly lower for individuals who live further away from such lakes and there may even be a national component to this distance decay suggesting that those who live in the same country as the lakes in question hold higher values for their improvement

Introducing willingness-to-pay for noise changes into transport appraisal: an application of benefit transfer.

Numerous research studies have elicited willingness-to-pay values for transport-related noise, however, in many industrialised countries including the UK, noise costs and benefits are still not incorporated into appraisals for most transport projects and policy changes (Odgaard et al, 2005; Grant-Muller et al, 2001). This paper describes the actions recently taken in the UK to address this issue, comprising: primary research based on the city of Birmingham; an international review of willingness-to-pay evidence; development of values using benefit transfers over time and locations; and integration with appraisal methods. Amongst the main findings are: that the willingness-to-pay estimates derived for the UK are broadly comparable with those used in appraisal elsewhere in Europe; that there is a case for a lower threshold at 1 45dB(A)Leq,18hr1 rather than the more conventional 55dB(A); and that values per dB(A) increase with the noise level above this threshold. There are significant issues over the valuation of rail versus road noise, the neglect of non-residential noise and the valuation of high noise levels in different countries. Conclusions are drawn regarding the feasibility of noise valuation based on benefit transfers in the UK and elsewhere, and future research needs in this field are discussed