IDEAS home Printed from https://ideas.repec.org/a/bla/coecpo/v26y2008i1p1-12.html
   My bibliography  Save this article

The Decision To Use Benefit Transfer Or Conduct Original Valuation Research For Benefit‐Cost And Policy Analysis

Author

Listed:
  • BRYON P. ALLEN
  • JOHN B. LOOMIS

Abstract

We develop a method for determining the economic returns to using original valuation research rather than benefit transfer to estimate nonmarket values for policy analysis purposes. We provide a method to guide policymakers in determining the project sizes for which original research can be expected to yield positive returns in terms of reduced decision errors. We then provide an empirical example of how our method can be applied to the estimation of recreation benefits and provide simple guidance to policymakers regarding the relationship between project size and expected returns to original valuation research to estimate recreation benefits. (JEL H43, Q51, Q26)

Suggested Citation

  • Bryon P. Allen & John B. Loomis, 2008. "The Decision To Use Benefit Transfer Or Conduct Original Valuation Research For Benefit‐Cost And Policy Analysis," Contemporary Economic Policy, Western Economic Association International, vol. 26(1), pages 1-12, January.
    • Handle: RePEc:bla:coecpo:v:26:y:2008:i:1:p:1-12
    DOI: 10.1111/j.1465-7287.2007.00066.x
    as

    Download full text from publisher

    File URL: https://doi.org/10.1111/j.1465-7287.2007.00066.x
    Download Restriction: no
    File URL: https://libkey.io/10.1111/j.1465-7287.2007.00066.x?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    References listed on IDEAS

    as
    1. Kirchhoff, Stefanie & Colby, Bonnie G. & LaFrance, Jeffrey T., 1997. "Evaluating the Performance of Benefit Transfer: An Empirical Inquiry," Journal of Environmental Economics and Management, Elsevier, vol. 33(1), pages 75-93, May.
    2. Downing, Mark & Ozuna, Teofilo Jr., 1996. "Testing the Reliability of the Benefit Function Transfer Approach," Journal of Environmental Economics and Management, Elsevier, vol. 30(3), pages 316-322, May.
    3. Kevin J. Boyle & Gregory L. Poe & John C. Bergstrom, 1994. "What Do We Know About Groundwater Values? Preliminary Implications from a Meta Analysis of Contingent-Valuation Studies," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 76(5), pages 1055-1061.
    4. John C. Bergstrom & Paul Civita, 1999. "Status of Benefits Transfer in the United States and Canada: A Review," Canadian Journal of Agricultural Economics/Revue canadienne d'agroeconomie, Canadian Agricultural Economics Society/Societe canadienne d'agroeconomie, vol. 47(1), pages 79-87, March.
    5. Smith, V. Kerry & Osborne, Laura L., 1996. "Do Contingent Valuation Estimates Pass a "Scope" Test? A Meta-analysis," Journal of Environmental Economics and Management, Elsevier, vol. 31(3), pages 287-301, November.
    6. Frank A. Ward & Diana Beal, 2000. "Valuing Nature with Travel Cost Models," Books, Edward Elgar Publishing, number 1768.
    7. Loomis, John B. & White, Douglas S., 1996. "Economic benefits of rare and endangered species: summary and meta-analysis," Ecological Economics, Elsevier, vol. 18(3), pages 197-206, September.
    8. Smith, V Kerry & Huang, Ju-Chin, 1995. "Can Markets Value Air Quality? A Meta-analysis of Hedonic Property Value Models," Journal of Political Economy, University of Chicago Press, vol. 103(1), pages 209-227, February.
    9. Smith, V. Kerry & Kaoru, Yoshiaki, 1990. "What have we learned since hotelling's letter? : A meta-analysis," Economics Letters, Elsevier, vol. 32(3), pages 277-281, March.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Robert Turner, 2013. "Using contingent choice surveys to inform national park management," Journal of Environmental Studies and Sciences, Springer;Association of Environmental Studies and Sciences, vol. 3(2), pages 120-138, June.
    2. John C. Whitehead & Andrew Ropicki & John Loomis & Sherry Larkin & Tim Haab & Sergio Alvarez, 2023. "Estimating the benefits to Florida households from avoiding another Gulf oil spill using the contingent valuation method: Internal validity tests with probability‐based and opt‐in samples," Applied Economic Perspectives and Policy, John Wiley & Sons, vol. 45(2), pages 705-720, June.
    3. Olander, Lydia & Polasky, Stephen & Kagan, James S. & Johnston, Robert J. & Wainger, Lisa & Saah, David & Maguire, Lynn & Boyd, James & Yoskowitz, David, 2017. "So you want your research to be relevant? Building the bridge between ecosystem services research and practice," Ecosystem Services, Elsevier, vol. 26(PA), pages 170-182.
    4. Gebeyehu Fetene & Søren Olsen & Ole Bonnichsen, 2014. "Disentangling the Pure Time Effect From Site and Preference Heterogeneity Effects in Benefit Transfer: An Empirical Investigation of Transferability," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 59(4), pages 583-611, December.
    5. Richardson, Leslie & Loomis, John & Kroeger, Timm & Casey, Frank, 2015. "The role of benefit transfer in ecosystem service valuation," Ecological Economics, Elsevier, vol. 115(C), pages 51-58.
    6. Newbold, Stephen C. & Johnston, Robert J., 2020. "Valuing non-market valuation studies using meta-analysis: A demonstration using estimates of willingness-to-pay for water quality improvements," Journal of Environmental Economics and Management, Elsevier, vol. 104(C).
    7. Robert J. Johnston & Kevin J. Boyle & Maria L. Loureiro & Ståle Navrud & John Rolfe, 2021. "Guidance to Enhance the Validity and Credibility of Environmental Benefit Transfers," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 79(3), pages 575-624, July.
    8. Francesco Jacopo Pintus, 2023. "Valuing drinking water quality after a PFAS contamination event: results from a meta-analysis benefit transfer," "Marco Fanno" Working Papers 0308, Dipartimento di Scienze Economiche "Marco Fanno".
    9. James L. Boutwell & John V. Westra, 2013. "Benefit Transfer: A Review of Methodologies and Challenges," Resources, MDPI, vol. 2(4), pages 1-11, October.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Chris Dumas & Pete Schuhmann & John C. Whitehead, 2004. "Measuring the Economic Benefits of Water Quality Improvement with the Benefit Transfer Method: An Introduction for Non-Economists," Working Papers 04-12, Department of Economics, Appalachian State University.
    2. Rosenberger, Randy & Loomis, John & Shrestha, Ram, 1999. "Meta-Analysis of Outdoor Recreational Use Value Estimates: Convergent Validity Tests," Western Region Archives 321710, Western Region - Western Extension Directors Association (WEDA).
    3. Ram Shrestha & John Loomis, 2003. "Meta-Analytic Benefit Transfer of Outdoor Recreation Economic Values: Testing Out-of-Sample Convergent Validity," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 25(1), pages 79-100, May.
    4. Bergstrom, John C. & Taylor, Laura O., 2006. "Using meta-analysis for benefits transfer: Theory and practice," Ecological Economics, Elsevier, vol. 60(2), pages 351-360, December.
    5. Brander, Luke M. & Ghermandi, Andrea & Kuik, Onno & Markandya, Anil & Nunes, Paulo A.L.D. & Schaafsma, Marije & Wagtendonk, Alfred, 2010. "Scaling up Ecosystem Services Values: Methodology, Applicability and a Case Study," Sustainable Development Papers 60689, Fondazione Eni Enrico Mattei (FEEM).
    6. Brouwer, Roy, 2000. "Environmental value transfer: state of the art and future prospects," Ecological Economics, Elsevier, vol. 32(1), pages 137-152, January.
    7. Ian J. Bateman & Andrew P. Jones, 2003. "Contrasting Conventional with Multi-Level Modeling Approaches to Meta-Analysis: Expectation Consistency in U.K. Woodland Recreation Values," Land Economics, University of Wisconsin Press, vol. 79(2), pages 235-258.
    8. V. Smith & Subhrendu Pattanayak, 2002. "Is Meta-Analysis a Noah's Ark for Non-Market Valuation?," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 22(1), pages 271-296, June.
    9. Rosenberger, Randall S. & Stanley, Tom D., 2006. "Measurement, generalization, and publication: Sources of error in benefit transfers and their management," Ecological Economics, Elsevier, vol. 60(2), pages 372-378, December.
    10. Rosenberger, Randall S. & Loomis, John B. & Shrestha, Ram K., 1999. "Panel Stratification In Meta-Analysis Of Environmental And Natural Resource Economic Studies," 1999 Annual Meeting, July 11-14, 1999, Fargo, ND 35705, Western Agricultural Economics Association.
    11. Zandersen, Marianne & Tol, Richard S.J., 2009. "A meta-analysis of forest recreation values in Europe," Journal of Forest Economics, Elsevier, vol. 15(1-2), pages 109-130, January.
    12. Smith, V. Kerry & Houtven, George Van & Pattanayak, Subhrendu, 1999. "Improving the Practice of Benefit Transfer: A Preference Calibration Approach," Western Region Archives 321702, Western Region - Western Extension Directors Association (WEDA).
    13. Jon Nelson & Peter Kennedy, 2009. "The Use (and Abuse) of Meta-Analysis in Environmental and Natural Resource Economics: An Assessment," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 42(3), pages 345-377, March.
    14. Brander, Luke M. & Van Beukering, Pieter & Cesar, Herman S.J., 2007. "The recreational value of coral reefs: A meta-analysis," Ecological Economics, Elsevier, vol. 63(1), pages 209-218, June.
    15. Rosenberger, Randall S. & Loomis, John B., 2000. "Panel Stratification In Meta-Analysis Of Economic Studies: An Investigation Of Its Effects In The Recreation Valuation Literature," Journal of Agricultural and Applied Economics, Southern Agricultural Economics Association, vol. 32(3), pages 1-12, December.
    16. Raymond J.G.M. Florax & Henri L.F. de Groot & Ruud A. de Mooij, 2002. "Meta-analysis: A Tool for Upgrading Inputs of Macroeconomic Policy Models," Tinbergen Institute Discussion Papers 02-041/3, Tinbergen Institute.
    17. Nijkamp, Peter & Vindigni, Gabriella & Nunes, Paulo A.L.D., 2008. "Economic valuation of biodiversity: A comparative study," Ecological Economics, Elsevier, vol. 67(2), pages 217-231, September.
    18. Shrestha, Ram K. & Loomis, John B., 2001. "Testing a meta-analysis model for benefit transfer in international outdoor recreation," Ecological Economics, Elsevier, vol. 39(1), pages 67-83, October.
    19. Moeltner, Klaus & Boyle, Kevin J. & Paterson, Robert W., 2007. "Meta-analysis and benefit transfer for resource valuation-addressing classical challenges with Bayesian modeling," Journal of Environmental Economics and Management, Elsevier, vol. 53(2), pages 250-269, March.
    20. Alston, Julian M. & Wyatt, T. J. & Pardey, Philip G. & Marra, Michele C. & Chan-Kang, Connie, 2000. "A meta-analysis of rates of return to agricultural R & D: ex pede Herculem?," Research reports 113, International Food Policy Research Institute (IFPRI).

    More about this item

    JEL classification:

    • H43 - Public Economics - - Publicly Provided Goods - - - Project Evaluation; Social Discount Rate
    • Q51 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Valuation of Environmental Effects
    • Q26 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Renewable Resources and Conservation - - - Recreational Aspects of Natural Resources

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:bla:coecpo:v:26:y:2008:i:1:p:1-12. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Wiley Content Delivery (email available below). General contact details of provider: https://edirc.repec.org/data/weaaaea.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.