Testing for differences in benefit transfer values between state and regional frameworks

Policy makers are often interested in transferring non-market estimates of environmental values from a 'source' study to predict economic values at a 'target' site. While most applications of the benefit transfer process involve an opportunistic search for suitable source studies, there are some examples available of more systematic approaches to developing a framework of values for benefit transfer processes. A key issue in developing such a framework is to deal with adjustment factors, where value estimates might vary systematically according to the context of the trade-offs. Previous research has identified that large differences in scope, such as between national and regional contexts, do affect values and hence benefit transfer. The research reported in this paper indicates that such differences are not significant for smaller scope variations, such as between state and regional contexts. These results provide some promise that systematic databases for benefit transfer can be developed.     

Choice Modeling and Tests of Benefit Transfer

Benefit transfer is increasingly being used by decision makers as a way of estimating environmental values suitable for use in benefit cost analysis. However, recent studies examining the validity of benefit transfer of passive use values estimated using contingent valuation have rejected the hypothesis of convergent validity. In this article, we demonstrate the usage of a form of conjoint analysis known as choice modeling for benefit transfer. Choice modeling has been touted as being particularly suitable for benefit transfer because it is possible to allow for differences in environmental quality and socioeconomic characteristics when transferring benefit estimates. We demonstrate that choice modeling is suitable for benefit transfer, particularly when the transfers involve implicit prices. Second, we examine the circumstances in which benefit transfer of choice modeling derived value estimates is likely to be most valid. Two split sample tests were undertaken to achieve this objective. The evidence from these tests indicates that transfers across different case study sites are likely to be subject to less error than those across different populations.     

Valuing New South Wales rivers for use in benefit transfer

The results from seven choice modelling applications designed to value improved river health in New South Wales are reported. These applications were designed to provide value estimates that could be used, through benefit transfer, to value improvements in the health of other rivers within the state. Because of limitations on the number of rivers that could be valued and populations sampled, a pooled model for use in benefit transfer was also estimated. The results indicate that both use and non-use values were found to exist for all catchments. In addition, value estimates were found to differ across catchments when populations resident within catchments were sampled. However, when populations resident outside catchments were sampled for two of these catchments, value estimates were found to be statistically similar. This indicates the importance of valuing improved river health in specific catchments by sampling populations within catchments. Yet, it also indicates that it is less critical to conduct multiple surveys of residents outside catchments to value improved river health.     

Status of Benefits Transfer in the United States and Canada: A Review

Benefits transfer refers to the use of existing benefit estimates in a different but similar context compared with the original study that generated the benefit estimates. Benefits transfer techniques include fixed value transfer, expert opinion and value estimator models. Although benefits transfer techniques are subject to a number of conceptual and empirical limitations, these techniques are widely applied by government agencies as input into economic assessments of public policies and projects.
Le concept d'estimation des avantages économiques par transposition de données connues s'applique à I'utilisation de données obtenues dans un certain contexte a un contexte distinct mais semblable par rapport à celui de l'étude originale. Il y a essentiellement trois variantes de cette démarche: à partir de valeurs fixes, de jugements experts ou de modèles estimateurs de valeurs. Bien que ces techniques soient exposées à un certain nombre de limites conceptuelles et empiriques, elles sont largement utilisées par les organismes gouvernementaux comme intrants pour l'évaluation economique de leurs programmes et de leurs projets.     

Estimating values for recreational fishing at freshwater dams in Queensland*

In this paper, estimates of value for recreational fishing are reported for three major freshwater impoundments in Queensland, Australia, using both travel cost and contingent valuation methods. Policy analysts often require estimates of value when analysing the importance of recreation against other uses of impoundments, or when considering the potential for further investments, such as with fish stocking programs. Different forms of the travel cost method are used to estimate separate consumer surpluses associated with two key subgroups of recreational anglers: frequent and occasional anglers. A contingent valuation study is used to estimate the marginal values associated with a potential improvement in fishing experience. The results of the travel cost analysis provide strong evidence that recreational values vary between different groups of anglers and across sites, while the contingent valuation estimates provide values for additional marginal benefits of recreational angling.     

Choice Modelling: Assessing the Environmental Values of Water Supply Options

Three criticisms of the contingent valuation method (CVM) are considered in this article. One technique that would appear to answer such criticisms is choice modelling (CM). CM permits value estimates for different goods sharing a common set of attributes to be pieced together using the results of a single multinomial (conditional) logit model. The CM approach to environmental value assessment is illustrated in the context of a consumer-based assessment of future water supply options in the Australian Capital Territory. CM is found to provide a flexible and cost-effective method for estimating use and passive use values, particularly when several alternative proposals need to be considered.     

Replication and translation of co-innovation: The influence of institutional context in large international participatory research projects

Stakeholder involvement in research processes is widely seen as essential to enhance the applicability of research. A common conclusion in the extensive body of literature on participatory and transdisciplinary research is the importance of the institutional context for understanding the dynamics and effectiveness of participatory projects. The role of institutional context has become increasingly important in view of large international research projects implementing shared participatory methodologies across countries (for example within Horizon 2020 and within CGIAR programmes), which each have different institutional contexts. Despite the generally accepted importance of the institutional context for understanding the unfolding of participatory and transdisciplinary research projects, surprisingly little research has actually looked into its role in greater detail. This paper aims to fill this gap in the literature by studying how a set of participatory principles and methods in a European project on integrated pest management (denoted as co-innovation in the project under study) was applied by researchers and advisers operating in a single international research project under the institutional conditions of four countries. The principal finding of this study is that, although constraints and enablers of participatory research at the personal level (e.g. researcher identity) were similar across the studied countries, research organisation- and community-based constraints and enablers differed, as well as those at the level of the overall innovation system. The institutions at different levels interact and create country-specific histories and path-dependencies, which lead to different degrees of propensity and preparedness, and hence different starting positions for participatory approaches. Consequently, when participatory research methods and approaches are applied in different contexts following a one-size-fits-all approach they may be less effective if not translated to institutional conditions at different levels. The study suggests that large international participatory research projects make provision in their design for careful selection of project team individuals, the composition of teams, and pay attention to the room for manoeuvre that the project, institute and national contexts provide for participatory research. To support the adjustment of participatory approaches to local institutional conditions, large international projects would benefit from fostering learning spaces that enable reflection on translation to local contexts and are capable of connecting to a wider network of decision makers and influencers that can facilitate institutional change in organisations and innovation systems.     

Systematic Variation in Willingness to Pay for Aquatic Resource Improvements and Implications for Benefit Transfer: A Meta-Analysis

Researchers are increasingly considering benefit transfer approaches that allow welfare measures to be adjusted for characteristics of the policy context. The validity and reliability of such adjustments, however, depends on the presence of systematic variation in underlying WTP. This paper describes a meta-analysis conducted to identify systematic components of WTP for aquatic resource improvements. Model results reveal systematic patterns in WTP unapparent from stated preference models considered in isolation, and suggest that observable attributes account for a substantial proportion of the variance in WTP estimates across studies. The analysis also exposes challenges faced in development, estimation, and interpretation of meta-models for benefit transfer and welfare guidance. These challenges remain salient even in cases where the statistical performance of meta-models is satisfactory.     

On the use of flexible mixing distributions in WTP space: an induced value choice experiment

In this study, we use data from an induced value choice experiment to compare estimates from mixed logit models in willingness to pay (WTP) space using different parameter distributional assumptions. Specifically, we test differences in WTP estimates when using flexible parameter mixing distributions (i.e. Legendre polynomials, step functions and splines) and conventional parameter distributions (normal and lognormal). Similar WTP estimates are obtained. However, we observe that WTP estimates are statistically different from the induced value when conventional distributions are assumed, but they are not when more flexible distributions are assumed. This suggests that flexible distributions can provide more reliable WTP estimates.     

Improving value transfer through socio‐economic adjustments in a multicountry choice experiment of water conservation alternatives

This study tests the transferability of the nonmarket values of water conservation for domestic and environmental purposes across three south European countries and Australia applying a common choice experiment design. Different approaches are followed to test the transferability of the estimated values, aiming to minimise transfer errors for use in policy analysis, comparing both single‐ and multicountry transfers, with and without socio‐economic adjustments. Within Europe, significant differences are found between implicit prices for environmental water use, but not for domestic water use. In the Australian case study, alleviating restrictions on domestic water use has no significant value. Pooling the three European samples improves the transferability of the environmental flow values between Europe and Australia. Results show that a reduction in transfer error is achieved when controlling for unobserved and observed preference heterogeneity in the single‐ and multicountry transfers, providing additional support for the superiority of socio‐economic adjustment procedures in value transfer.     

Forest governance and economic values of forest ecosystem services in Vietnam

Forest ecosystems deliver valuable services to humanity. However, many forests are being degraded and their services have been undervalued. The main problem lies in the inadequate institutional arrangements for forest governance. This paper aims to assess the effects of alternative forest governance arrangements on the provision and economic values of forest ecosystem services (FES) in Vietnam. The study presents a framework for mapping land use and land cover (LULC) change stemming from actual and hypothetical changes in forest governance regimes, quantifies the resulting changes in the provision of FES, and estimates the associated economic values. In the context of the study site in the North Western uplands of Vietnam, we test three alternative forest governance scenarios: business as usual, with a dominant government role; a community-based governance regime; and a private, individual-based forestry governance regime. Scenarios are based quite closely on the way these regimes are (or might be expected to be) implemented in Vietnam. For each forest governance scenario, we map LULC changes based on land suitability analysis and transition likelihood for the period 2010 − 2020. The resulting maps are used as inputs into the InVEST (Integrated Valuation of Environmental Services and Tradeoffs) model, which is used to estimate the quantity of three specific FES: carbon storage/sequestration, sediment yield, and water yield. We apply economic valuation methods to value these services: the social cost of carbon is used to estimate the economic values of carbon storage/sequestration; the cost of removing sediment deposited in reservoirs is applied for valuing the reduction of sediment yield, and the residual value of water supply for hydropower generation is used for valuing water yield. The results show that forest governance regimes have a significant effect not only on forest LULC, but also on the quantity and values of FES derived from forests. The FES are differentially affected by alternative forest governance regimes: some FES increase in quantity and value under some governance regimes and decrease under others. Of the three forest governance regimes examined, there is no one regime that will always be ‘better’ than the others in terms of provisioning all considered FES. For the specific context of Vietnam, we find that the private forest governance scenario is inferior to the community-based governance scenario, as an alternative to the current state-based governance. Because our results pertain to the scenarios as constructed, rather than generally to broad categories of governance regimes, there remains the possibility that regimes can be constructed that outperform all of those examined here.     

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

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.     

Using Contingent Valuation to Measure User and Nonuser Benefits: An Application to Public Transit

The contingent valuation method (CVM) was used to measure the value of a community service, rural transit, that has both user and nonuser values. Traditional focus groups and a CVM questionnaire provide estimates of willingness to pay and willingness to accept. Tobit analysis was used to test relationships among the variables. Income was not related to the amount of perceived benefit, but the alternative desire to provide transit for others was statistically significant. Ranges for possible total benefits, user and nonuser, are provided for the test transit systems. Proper aggregation of benefits to the population was found to be critical.     

The Simple Analytics of Transferable Production Quota: Implications for the Marginal Cost of Ontario Milk Production

Using a competitive dynamic optimization model, the difference between unused and used industrial milk quota values is shown to give an exact measure of the annual rental rate of production quota. Knowledge of the rental rate of production quota and output price can be used to impute the marginal cost of industrial milk production. However, if there is a transfer tax on production quota sales, the imputation of the equilibrium rental value of quota depends on the elasticity of demand and supply for quota as well as the level of the transfer assessment. The marginal cost of Ontario milk production is estimated for each year from 1980–81 to 1994–95, based on unused and used quota values. However, the imputed marginal cost estimates are not totally satisfactory. The results suggest that caution should be exercised in using the difference between unused and used quota prices as a measure of the rental rate of industrial milk production quota.     

Innovation context and technology traits explain heterogeneity across studies of agricultural technology adoption: A meta-analysis

Despite a wealth of case-specific insights from agricultural adoption studies, we lack systematic evidence on which technology characteristics matter for adoption across different innovation contexts. We synthesise the results of 304 quantitative farm-level adoption studies for a wide range of agricultural innovations across more than 60 countries using multi-level meta regression. Our results show that land, capital and knowhow are generally more important when an innovation uses the respective factor intensively, but this effect is reduced in contexts where the factor is abundant. Our findings have implications for the design of rural development and agricultural extension programmes. Both should consider the interplay of geographic context and innovation characteristics to develop more effective sustainable intensification strategies.     

Testing Choice Experiment for Benefit Transfer with Preference Heterogeneity

Benefit transfer is a cost-effective method for estimating the value of environmental goods that relies on information obtained in previous studies. The multiattribute approach of choice experiments should provide advantages in terms of benefit transfer, allowing differences in environmental improvements between sites as well as differences in socioeconomic and attitude characteristics between respondent populations. This article investigates the capability of choice experiment method to be used in environmental benefit transfer when a random parameters approach is used to allow for preference heterogeneity: we find that the inclusion of respondents' taste heterogeneity reduces the magnitude of the transfer error.     

Who gains from Australian generic wine promotion and R&D?

The present paper estimates the distributions of aggregate returns from different types of research and promotion investments by the Australian grape and wine industry among grapegrowers, winemakers, domestic and foreign consumers, and the tax office. The results show that most of the gains from cost-reducing R&D in grape and wine production go to producers and that producers get a far larger share of the benefit from export promotion than that from domestic promotion. Foreign consumers of Australian wine also enjoy a significant share of the benefits from Australian R&D. Sensitivity analysis shows that the key results hold for a wide range of parameter values.     

Labeling Context and Reference Point Effects in Models of Food Attribute Demand

There is considerable interest in the effect of labels on food product demand. Labeling statements may convey new information about attributes and place consumers in different choice contexts; consumers' assessment of information in labels may be affected by reference points. We examine labeling context relating to genetically modified (GM) food as a factor in the stochastic component of a random utility model and assess reference points over a set of observable characteristics of consumers. We find that labeling context effects are present, although relatively small, while reference dependence is a very important factor that varies over observable characteristics of the sampled consumers.     

Values and attitudes of the urban public towards peri-urban agricultural land

Peri-urban agricultural landscapes around the world are undergoing rapid transformation due to urban expansion. While some landscape values are being protected by current land-use planning frameworks, we know little about the broader values and attitudes of the urban public shaping this transformation. The structure of the values assigned to peri-urban agricultural landscapes by residents of Melbourne, Australia was explored and related to stated landscape preferences and people's underlying values. Exploratory factor analysis was used to categorise assigned values in multifunctional, food and native biota groups, and stated preferences for photographs into four landscape categories: intensive landscapes, extensive landscapes, high tree cover and plantations. The structure of underlying personal values closely resembled other studies of environmental value orientations. Multiple regression analysis revealed that preferences for all landscape categories were predicted strongly by multifunctional assigned values. Significant relationships were also evident between all assigned value groups and the biospheric underlying value orientation. Attitudes towards residential development approaches were also related significantly to assigned but not underlying values. Assigned values appear therefore to mediate between underlying values and attitudes towards peri-urban landscapes. This research demonstrates that peri-urban agricultural landscapes are perceived as multifunctional systems by the urban public and are valued for a range of functions not typically included in land use policies. This study also suggests that in the context of rapid land use change, a variety of landscape types should be retained on the urban fringe for their benefit to the urban public, and synergies promoted between landscape functions.     

Exploring the cost effectiveness of land conservation auctions and payment policies*

This article evaluates the cost‐effectiveness of the Catchment Care Australian conservation auction. It provides evidence of auction cost effectiveness, and estimates cost savings from two discrete components: (i) the opportunity cost revelation incentive provided by the auction mechanism, and (ii) the improved environmental targeting capacity that results from development of a scientifically based environmental benefits assessment capacity. Results show that there are potentially very large returns associated with the latter component that have been overlooked in the literature. Additionally, transaction costs involved with administering the case study conservation auction and the prior non‐auction payment policy are compared. We find that the administration costs for the auction were greater than or equal to those associated with the prior policy. Estimates of relative cost effectiveness across policies are shown to be sensitive to the methods of comparison. In this case study, there is inelastic supply of the last units of environmental benefit. This inelasticity results in large estimated auction comparative cost advantage when the benefit metric is the estimated cost required to achieve auction aggregate environmental benefit. Estimated benefit of the auction is much less when measured as environmental benefits attainable with alternative payment policies subject to the auction budget constraint.