A framework for estimating willingness-to-pay to avoid endogenous environmental risks

Resource and Energy Economics

Volumn 33, Issue 1, 2011, Pages 130-154

  Konishi, Yoshifumi ^a   Adachi, Kenji ^b  

^a WILLIAMS COLLEGE   (United States)

^b UNIVERSITY OF MINNESOTA   (United States)

Author keywords

Compensating variation; Dummy endogenous variable; Environmental risk; Self protection

Indexed keywords

ARSENIC CONTAMINATION; COMPENSATING VARIATION; COMPETING EFFECTS; CONVENTIONAL APPROACH; DRINKING WATER; DUMMY ENDOGENOUS VARIABLE; ENVIRONMENTAL RISKS; INFORMATION COMPONENTS; NON-MARKET VALUATION; POLICY IMPLICATIONS; PROTECTIVE ACTION; RISK LEVELS; RISK MITIGATION; SELF-PROTECTION; SELF-PROTECTIVE; VARIABLE MODEL; WILLINGNESS TO PAY;

ARSENIC; ESTIMATION; INFORMATION DISSEMINATION; POTABLE WATER; SURVEYS;

RISK PERCEPTION;

CONTINGENT VALUATION; ENVIRONMENTAL RISK; ESTIMATION METHOD; NUMERICAL MODEL; RISK ASSESSMENT; WILLINGNESS TO PAY;

EID: 77958537068     PISSN: 09287655     EISSN: None     Source Type: Journal    
DOI: 10.1016/j.reseneeco.2010.03.001     Document Type: Article

References (66)

1. Abdalla C.W., Roach B.A., Epp D.J. Valuing environmental quality change using averting expenditures: an application to groundwater contamination. Land Economics 1992, 68:163-169.
2. Abrahams N.A., Hubbell B.J., Jordan J.L. Joint production and averting expenditure measures of willingness to pay: do water expenditures really measure avoidance costs?. American Journal of Agricultural Economics 2000, 82:427-437.
3. Alberini A. Optimal designs for discrete choice contingent valuation surveys: single-bound, double-bound, and bivariate models. Journal of Environmental Economics and Management 1995, 28:287-306.
4. Alberini A. Efficiency vs bias of willingness-to-pay estimates: bivariate and interval-data models. Journal of Environmental Economics and Management 1995, 29:169-180.
5. Alberini A., Kanninen B., Carson R.T. Modeling response incentive effects in dichotomous choice contingent valuation data. Land Economics 1997, 73(3):309-324.
6. Arrow K.J., Cropper M.L., Eads G.C., Hahn R.W., Lave L.B., Noll R.G., Portney P.R., Russell M., Schmalensee R., Smith V.K., Stavins R.N. Benefit-Cost Analysis in Environmental, Health, and Safety Regulation: A Statement of Principles 1996, The American Enterprise Institute for Public Policy Research, Washington, DC.
7. Banzhaf H.S., Burtraw D., Evans D., Krupnick A.J. Valuation of natural resources in the adirondacks. Land Economics 2006, 82:445-464.
8. Bartik T.J. Evaluating the benefits of non-marginal reductions in pollution using information on defensive expenditures. Journal of Environmental Economics and Management 1988, 15:111-127.
9. Bateman I.J., Brouwer R., Georgiou S., Hanley N., Machado F., Mourato S., Saunders C. A 'natural experiment' approach to contingent valuation of private and public UV health risk reduction strategies in low and high risk countries. Environmental and Resource Economics 2005, 31:47-72.
10. Blamey R.K., Bennet J.W., Morrison M.D. Yea-saying in contingent valuation surveys. Land Economics 1999, 75:126-141.
11. Bosworth R., Cameron T.A., DeShazo J.R. Demand for environmental policies to improve health: evaluating community-level policy scenarios. Journal of Environmental Economics and Management 2009, 57:293-308.
12. Boyle K.J., Bishop R.C., Welsh M.P. Starting point bias in contingent valuation bidding games. Land Economics 1985, 61(2):188-194.
13. Boyle K.J., Johnson F.R., McCollum D.W. Anchoring and adjustment in single-bounded, contingent-valuation questions. American Journal of Agricultural Economics 1997, 79(5):1495-1500. proceedings Issue.
14. Berger M., Blomquist G., Kenkel D., Tolley G. Valuing changes in health risk: a comparison of alternative measures. Southern Economic Journal 1987, 53:967-983.
15. Bresnahan B.W., Dickie M. Averting behavior and policy evaluation. Journal of Environmental Economics and Management 1995, 29:378-392.
16. Bresnahan B.W., Dickie M., Gerking S. Averting behavior and urban air pollution. Land Economics 1997, 73(3):340-357.
17. Cameron T.A. A new paradigm for valuing non-market goods using referendum data: maximum likelihood estimation by censored logistic regression. Journal of Environmental Economics and Management 1988, 15:355-379.
18. Cameron T.A., Englin J. Respondent experience and contingent valuation of environmental goods. Journal of Environmental Economics and Management 1997, 33:296-313.
19. Cameron T.A., Quiggin J. Estimating using contingent valuation data from a "dichotomous choice with follow-up questionnaire. Journal of Environmental Economics and Management 1994, 27:218-234.
20. Cappellari L., Jenkins S.P. Multivariate probit regression using simulated maximum likelihood. The Stata Journal 2003, 3(3):278-294.
21. Carson R.T., Hanemann W.M. Contingent valuation. Handbook of Environmental Economics, vol. 2 2005, Elsevier B.V., London. K.-G. Maler, J.R. Vincent (Eds.).
22. Chay K., Greenstone M. The impact of air pollution on infant mortality: evidence from geographic variation in pollution shocks induced by a recession. Quarterly Journal of Economics 2003, 118(3):1121-1167.
23. Chien Yu-Lan., Huang C.J., Shaw D. A general model of starting point bias in double-bounded dichotomous contingent valuation surveys. Journal of Environmental Economics and Management 2005, 50:362-377.
24. Cho, Y., Konishi, Y., Easter, K.W., 2007. Can rural communities comply with the new arsenic standard for drinking water? Staff Paper P07-16 Department of Applied Economics, University of Minnesota.
25. Courant P.N., Porter R.C. Averting expenditure and the cost of pollution. Journal of Environmental Economics and Management 1981, 8:321-329.
26. Dickie M., Gerking S. Formation of risk beliefs, joint production and willingness to pay to avoid skin cancer. Review of Economics and Statistics 1996, 78(3):451-463.
27. Gayer T., Hamilton J.T., Viscusi W.K. Private values of risk tradeoffs at superfund sites: housing market evidence on learning about risk. Review of Economics and Statistics 2000, 82(3):439-451.
28. Greene W.H. Gender economics courses in liberal arts colleges: further results. Journal of Economic Education 1998, 29(4):291-300.
29. Greene W.H. Econometric Analysis 2003, Prentice Hall, New Jersey. fifth ed.
30. Hajavassiliou, V.A., Ruud, P.A., 1994. Classical estimation methods for LDV models using simulation. In: Engle, R.F., McFadden, D.L. (Eds.), Handbook of Econometrics, vol. IV. North-Holland, Amsterdam.
31. Hanemann M., Loomis J., Kanninen B. Statistical efficiency of double-bounded dichotomous choice contingent valuation. American Journal of Agricultural Economics 1991, 73(4):1255-1263.
32. Heckman J.J. Dummy endogenous variables in a simultaneous equation system. Econometrica 1978, 46(4):931-959.
33. Herriges J.A., Shogren J.F. Starting point bias in dichotomous choice valuation with follow-up questioning. Journal of Environmental Economics and Management 1996, 30:112-131.
34. Hoehn J.P., Randall A. The effect of resource quality information on resource injury perceptions and contingent values. Resource and Energy Economics 2002, 24:13-31.
35. Horowitz J.L. Bootstrap-based critical values for the information matrix test. Journal of Econometrics 1994, 61:395-411.
36. Jakus P.M., Shaw W.D., Nguyen T.N., Walker M. Risk perceptions of arsenic in tap water and consumption of bottled water. Water Resources Research 2009, 45:W05405.
37. Kim C.W., Phipps T.T., Anselin L. Measuring the benefits of air quality improvement: a spatial hedonic approach. Journal of Environmental Economics and Management 2003, 45:24-39.
38. Konishi Y., Coggins J.S. Environmental risk and welfare valuation under imperfect information. Resource and Energy Economics 2008, 30(2):150-169.
39. Krupnick A., Alberini A., Cropper M., Simon N., O'brien B., Goeree R., Heintzelman M. Age, health, and the willingness to pay for mortality risk reductions: a contingent valuation survey of Ontario residents. Journal of Risk and Uncertainty 2002, 24(2):161-186.
40. Laughland A.S., Musser L.M., Musser W.N., Shortle J.S. The opportunity cost of time and averting expenditures for safe drinking water. Water Resources Bulletin 1993, 29(2):291-299.
41. Lee F.L. Tests for the bivariate normal distribution in econometric models with selectivity. Econometrica 1984, 52:843-863.
42. Leggett C.G., Klechner N.S., Boyle K.J., Duffield J.W., Mitchell R.C. Social desirability bias in contingent valuation surveys administered through in-person interviews. Land Economics 2003, 79(4):561-575.
43. McConnell K.E. Models for referendum data: the structure of discrete choice models for contingent valuation. Journal of Environmental Economics and Management 1990, 18:19-34.
44. Mitchell R.C., Carson R.T. Using Surveys to Value Public Goods: The Contingent Valuation Method 1989, Resources for the Future, Washington, DC.
45. Murdock J.C., Thayer M.A. Hedonic price estimation of variable urban air quality. Journal of Environmental Economics and Management 1988, 15:143-146.
46. Murdock J.C., Thayer M.A. The benefits of reducing the incidence of nonmelanoma skin cancers: a defensive expenditures approach. Journal of Environmental Economics and Management 1990, 18:107-119.
47. Murphy A. Score tests of normality in bivariate probit models. Economics Letters 2007, 95:374-379.
48. Neidell M. Information, avoidance behavior, and health: the effect of ozone on asthma hospitalizations. Journal of Human Resources 2009, 44(2):450-478.
49. Pattanayak S.K., Yang J.C., Whittington D., Kumar K.C.B. Coping with unreliable public water supplies: averting expenditures by households in Kathmandu, Nepal. Water Resources Research 2005, 41:W02012.
50. Patterson D.A., Duffield J.W. Comment on Cameron's censored logistic regression model for referendum data. Journal of Environmental Economics and Management 1991, 20:275-283.
51. Portney P.R. Housing prices, health effects, and valuing reductions in risk of death. Journal of Environmental Economics and Management 1981, 8:72-78.
52. Powell, J.R., 1991. The value of groundwater protection: measurement of willingness-to-pay information, and its utilization by local government decisionmakers. Unpublished doctoral dissertation, Cornell University.
53. Quiggin J. Risk, self-protection and ex ante economic value-some positive results. Journal of Environmental Economics and Management 1992, 23:40-53.
54. Shogren J.F., Crocker T.D. Risk, self-protection, and ex ante economic value. Journal of Environmental Economics and Management 1991, 20:1-15.
55. Shogren J.F., Crocker T.D. Risk and its consequences. Journal of Environmental Economics and Management 1999, 37:44-51.
56. Smith R.J. Some tests for misspecification in bivariate limited dependent variables models. Annales de l'inséé 1985, 59/60:97-123.
57. Smith V.K., Johnson F.R. How do risk perceptions respond to information? The case of radon. The Review of Economics and Statistics 1988, 70(1):1-8.
58. Stewart J.M., O'Shea E., Donaldson C., Shackley P. Do ordering effects matter in willingness-to-pay studies of health care?. Journal of Health Economics 2002, 21:585-599.
59. Viscusi W.K., Gayer T. Quantifying and valuing environmental health risks. Handbook of Environmental Economics, vol. 2 2005, Elsevier B.V. K.-G. Maler, J.R. Vincent (Eds.).
60. Viscusi W.K., Aldy J.E. Labor market estimates of the senior discount for the value of statistical life. Journal of Environmental Economics and Management 2007, 53:377-392.
61. Walker M., Shaw D., Benson M. Arsenic consumption and health perceptions in a rural western U.S. area. Journal of the American Water Resources Association 2006, 42:1363-1370.
62. Whitehead J.C. Incentive incompatibility and starting-point bias in iterative valuation questions. Land Economics 2002, 78(2):285-297.
63. Whitehead J.C. Incentive incompatibility and starting-point bias in iterative valuation questions: reply. Land Economics 2004, 80(2):316-319.
64. Whitehead J.C. Combining willingness to pay and behavior data with limited information. Resource and Energy Economics 2005, 27:143-155.
65. Whynes D.K., Frew E., Wolstenholme J.L. A comparison of two methods for eliciting contingent valuations of colorectal cancer screening. Journal of Health Economics 2003, 22:555-574.
66. Wu J., Cook V.J., Strong E.C. A two-stage model of the promotional performance of pure online firms. Information Systems Research 2005, 16(4):334-351.