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Contingent Valuation Versus Choice Experiments: Estimating the Benefits of Environmentally Sensitive Areas in Scotland
Author(s) -
Hanley Nick,
MacMillan Douglas,
Wright Robert E.,
Bullock Craig,
Simpson Ian,
Parsisson Dave,
Crabtree Bob
Publication year - 1998
Publication title -
journal of agricultural economics
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 1.157
H-Index - 61
eISSN - 1477-9552
pISSN - 0021-857X
DOI - 10.1111/j.1477-9552.1998.tb01248.x
Subject(s) - contingent valuation , valuation (finance) , choice modelling , novelty , willingness to pay , economics , econometrics , environmental economics , computer science , microeconomics , business , marketing , accounting , philosophy , theology
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.