Elicitation of Expert Opinion in Benefit Transfer of Environmental Goods

Benefit transfer is a method for estimating the value of environmental goods that involves the use of past information on identical or similar goods. This paper considers the extent to which benefit transfer can be based on prior distributions elicited from expert opinion. We propose two alternative methods to elicit the parameters of a prior distribution from experts on environmental valuation. An experiment is carried out on the value of National Parks in Spain. The results from the elicited distributions are compared with the information provided by onsite samples of visitors. The results indicate that individual experts made different predictions about the potential value of the policy areas that were diverse and unable to accurately predict the value for each policy site. However, the average across the elicited distributions approaches the estimated distribution with empirical data and accurately predicts the relative values for the two policy sites considered.     

An analysis of asymmetric demand response to price changes: The case of local telephone calls

Asymmetric demand responses to price changes are not an observable implication of classical demand theory, which predicts that consumers will react to a small price increase in much the same way as they do to a small price decrease. Yet applied researchers have long speculated that consumers are more sensitive to price increases than they are to price decreases. In addition, recent empirical studies generally support the theory of asymmetric demand responses. We construct a dynamic model based on data gathered from monthly telephone bills for 128 New York Telephone customers over a five-year period. Our results support the conclusion that customers react more quickly and strongly when prices go up than they do when prices go down.We would like to thank Manny Haas and Bernie Reddy for their comments and suggestions.