Contingent Valuation Versus Choice Experiments: Estimating the Benefits of Environmentally Sensitive Areas in Scotland

Abstract

This paper reports results from a study of the economic value of the conservation benefits of Environmentally Sensitive Areas (ESAs) in Scotland. The main novelty of the approach taken is in comparing two direct valuation methods, namely contingent valuation and choice experiments, to value these benefits. The Contingent Valuation Method (CVM) is well‐established as a technique for valuing the sorts of landscape and wildlife enhancements associated with ESAs. The CVM experiment reported here uses a dichotomous choice format, and includes a new correction for part‐whole bias. Choice experiments are much less used as an environmental valuation technique. We note several advantages of such experiments over CVM, and then report characteristic values and ‘programme values’ estimated using the method. This application brings to light some problems in applying the choice experiment method. Finally, we discuss the issue of benefits transfer in the context of these two approaches to valuation.

Traffic related noise and air quality valuations: evidence from stated preference residential choice models

“…This is consistent with evidence in the broader area of environmental valuation where there have been many more studies that have compared different methods (Bishop and Heberlein, 1979;Brookshire et al, 1982;Boxall et al 1996;Carson et al, 1996;Foster et al, 1997;Adamowicz et al, 1994, 1997, 1998, Hanley et al, 1998a, 1998b, 2002. As Hanley et al (2001) point out, the evidence is clear that the values obtained from and the intended payments of CVM are generally less than the values and payments of actual behaviour.…”

“…On the other hand, the findings of SP models have generally compared favourably with equivalent RP results (Adamowicz et al, 1994(Adamowicz et al, , 1997Boxall et al, 1996;Hanley et al, 2002). Whilst it is therefore surprising that where SP and CVM have been compared (Boxall et al, 1996;Adamowicz et al 1998;Hanley et al, 1998aHanley et al, , 1998b the SP values are not always greater, it is noticeable that the iterative bidding form of CVM was used where the CVM values were higher and this tends to give higher values than the open ended variant (Bateman et al, 1995).…”

Agricultural sustainability: concepts, principles and evidence

“…Some authors suggest that the current system of economic calculations grossly underestimates the current and future value of natural capital (Abramovitz 1997;Costanza et al 1997;Daily 1997;MEA 2005). However, such valuation of ecosystem services remains controversial owing to methodological and measurement problems (Georgiou et al 1998;Hanley et al 1998;Carson 2000;Farrow et al 2000;Pretty et al 2003a) and the role monetary values have in influencing public opinions and policy decisions.…”

Private household demand for vehicles on alternative fuels and drive trains: a review

“…CVand CM offer rather different merits and their use entirely depends on the purpose of the study under consideration. CM is particularly suited to measure the marginal value of changes in various characteristics of environmental goods and allows a deeper understanding of the trade-offs between attributes, whereas CV is a better technique than CM when the main objective of the study is to value an overall policy package and for assisting in policy evaluations [25,43,44,50].…”