Individuals who are likely to realize the largest benefits from improvements in air quality often depend on other members of their households to make time or monetary contributions to their care. The presence of these dependency relationships among household members poses challenges for benefit estimation since it is unlikely that the conditions necessary for recovering the underlying individual preferences from household choices are satisfied in this setting. We propose a conceptual framework that highlights the role of these dependencies in the choice models used to estimate the willingness to pay for environmental quality improvements. We design a complementary stated preference survey that describes hypothetical dependency relationships for household members of different ages to test the implications of our conceptual model. Respondents’ choices take into account the care-giving responsibilities for young children and teenagers but not for older adults.
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Paper provided by National Bureau of Economic Research, Inc in its series NBER Working Papers with number
15366.
Length: Date of creation: Sep 2009 Date of revision: Handle: RePEc:nbr:nberwo:15366
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Find related papers by JEL classification: H41 - Public Economics - - Publicly Provided Goods - - - Public Goods Q51 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Valuation of Environmental Effects
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