Contingent Valuation of Environmental Goods

Edited by Daniel McFadden, E. Morris Cox Professor of Economics and Kenneth Train, Adjunct Professor Emeritus of Economics, University of California, Berkeley, US

• Contents:IntroductionDaniel McFadden and Kenneth Train1. Response to cost prompts in stated preference valuation of environmental goodsJames Burrows, Powell Dixon and Hiu Man Chan2. Fat tails and truncated bids in contingent valuation: an application to an endangered shorebird speciesGeorge Parsons and Kelley Myers 3. Inadequate response to frequency of payments in contingent valuation of environmental goodsKelley Myers, George Parsons, and Kenneth Train4. An adding-up test on contingent valuations of river and lake qualityWilliam Desvousges, Kristy Mathews and Kenneth Train 5. Do contingent valuation estimates of willingness to pay for non-use environmental goods pass the scope test with adequacy? A review of the evidence from empirical studies in the literatureJames Burrows, Rebecca Newman, Jerry Genser and Jeffrey Plewes6. Stated preference methods and their applicability to environmental use and non-use valuationsDaniel McFadden7. Some findings from further exploration of the “composite good” approach to contingent valuationMichael Kemp, Edward Leamer, James Burrows and Powell Dixon8. Inferences from stated preference surveys when some respondents do not compare costs and benefitsEdward Leamer and Josh Lustig9. Assessing the validity of stated preference data using follow-up questionsKelley Myers, Doug MacNair, Ted Tomasi and Jude Schneider10. Hypothetical bias: a new meta-analysisHarry Foster and James Burrows11. Legal obstacles for contingent valuation methods in environmental litigationBrian D. Israel, Jean Martin, Kelly Smith Fayne, and Lauren DanielIndex

'While scepticism about the validity of contingent valuation (CV) approach is widespread in many parts of the choice modelling community, advocates of CV for the valuation of environmental goods point to a number of guidelines that, if followed (often blindly), should lead to reliable results. The evidence in this excellent book, compiled in an objective manner by Dan McFadden and Kenneth Train, casts doubts on this, and points to the far bigger issue of respondents not being able to adequately value such unfamiliar goods in a survey context. The book makes required reading for anyone interested in the topic and suggests that researchers and practitioners in environmental economics should think very carefully about their continued reliance on CV, or indeed other stated preference approaches, for the valuation of environmental goods.'