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Using Choice Experiments to value River and Estuary Health in Tasmania with Individual Preference Heterogeneity

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  • Marit E Kragt

    ()
    (Crawford School of Public Policy, The Australian National University, Australia)

  • Jeff Bennett

    ()
    (Crawford School of Public Policy, The Australian National University, Australia)

Abstract

Choice experiments (CE – otherwise known as Choice Modelling) have become widespread as an approach to environmental valuation in Australia. There are, however, limited applications that have focused on the estimation of estuary values. Furthermore, none of the existing valuation studies have addressed catchment management changes in Tasmania. The CE study described in this report aims to elicit community preferences for natural resource management options in the George catchment in north-eastern Tasmania. The survey was administered in different sub-sample locations in Tasmania to assess the trade-offs respondents are willing to make between environmental attributes and costs. Catchment health attributes were the length of native riverside vegetation and the number of rare animal and plant species in the George catchment. The area of healthy seagrass beds in the Georges Bay was used as a measure of estuary condition. Results from mixed logit models show that respondents are, on average, willing to pay between $3.47 and $5.11 for a km increase in native riverside vegetation and between $7.10 and $12.42 per species for the protection of rare native plants and animals, ceteris paribus. The results are ambiguous about respondents’ preferences for estuary seagrass area. This study further shows significant differences between logit models when accounting for unobserved preference heterogeneity and repeated choices made by the same individual. Key words: Choice experiments, Preference heterogeneity, Mixed Logit models, River health, Estuary health, Tasmania, Environmental valuation

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Bibliographic Info

Paper provided by Environmental Economics Research Hub, Crawford School of Public Policy, The Australian National University in its series Environmental Economics Research Hub Research Reports with number 0916.

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Date of creation: Feb 2009
Date of revision: Sep 2009
Handle: RePEc:een:eenhrr:0916

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  1. Morrison, Mark & Bennett, Jeffrey W., 2004. "Valuing New South Wales rivers for use in benefit transfer," Australian Journal of Agricultural and Resource Economics, Australian Agricultural and Resource Economics Society, vol. 48(4), December.
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  5. Danny Campbell & W. Hutchinson & Riccardo Scarpa, 2008. "Incorporating Discontinuous Preferences into the Analysis of Discrete Choice Experiments," Environmental & Resource Economics, European Association of Environmental and Resource Economists, vol. 41(3), pages 401-417, November.
  6. Kragt, Marit Ellen & Bennett, Jeffrey W., 2008. "Designing choice experiments to Test for Anchoring and Framing Effects," Research Reports 94810, Australian National University, Environmental Economics Research Hub.
  7. Greene, William H. & Hensher, David A., 2007. "Heteroscedastic control for random coefficients and error components in mixed logit," Transportation Research Part E: Logistics and Transportation Review, Elsevier, vol. 43(5), pages 610-623, September.
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  9. Greene, William H. & Hensher, David A. & Rose, John, 2006. "Accounting for heterogeneity in the variance of unobserved effects in mixed logit models," Transportation Research Part B: Methodological, Elsevier, vol. 40(1), pages 75-92, January.
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  11. Ladenburg, Jacob & Olsen, Søren Bøye, 2008. "Gender-specific starting point bias in choice experiments: Evidence from an empirical study," Journal of Environmental Economics and Management, Elsevier, vol. 56(3), pages 275-285, November.
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Cited by:
  1. John Rolfe & Roy Brouwer, 2011. "Testing for value stability with a meta-analysis of choice experiments: River health in Australia," Environmental Economics Research Hub Research Reports 1095, Environmental Economics Research Hub, Crawford School of Public Policy, The Australian National University.
  2. Kragt, Marit E., 2013. "Comparing models of unobserved heterogeneity in environmental choice experiments," 2013 Conference (57th), February 5-8, 2013, Sydney, Australia 152198, Australian Agricultural and Resource Economics Society.
  3. Dan Marsh & Lena Mkwara & Riccardo Scarpa, 2011. "Do Respondents’ Perceptions of the Status Quo Matter in Non-Market Valuation with Choice Experiments? An Application to New Zealand Freshwater Streams," Sustainability, MDPI, Open Access Journal, vol. 3(9), pages 1593-1615, September.
  4. Kragt, Marit Ellen & Bennett, Jeffrey W., 2009. "Integrating economic values and catchment modelling," 2009 Conference (53rd), February 11-13, 2009, Cairns, Australia 47956, Australian Agricultural and Resource Economics Society.
  5. Rolfe, John & Brouwer, Roy, 2011. "Testing for value stability with a meta-analysis of choice experiments: River health in Australia," Research Reports 107744, Australian National University, Environmental Economics Research Hub.

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