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On the Use of Subjective Well-Being Data for Environmental Valuation

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Author Info

  • Ferreira, Susana
  • Moro, Mirko

Abstract

This paper explores the potential of using subjective well-being (SWB) data to value environmental attributes. A theoretical framework compares this method, also known as the lifesatisfaction approach, with the standard hedonic pricing approach, identifying their similarities and differences. As a corollary, we show how SWB data can be used to test for the equilibrium condition implicit in the hedonic approach (i.e., equality of utility across locations). Results for Ireland show that the equilibrium condition required by the hedonic pricing approach in Irish markets does not hold. They also show that air quality, in the baseline specification, and warmer climate, across all the specifications, have a significant positive impact on SWB. Their associated monetary estimates, however, seem too large.

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File URL: http://hdl.handle.net/1893/1892
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Bibliographic Info

Paper provided by University of Stirling, Division of Economics in its series Stirling Economics Discussion Papers with number 2009-24.

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Date of creation: Dec 2009
Date of revision:
Handle: RePEc:stl:stledp:2009-24

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Postal: Division of Economics, University of Stirling, Stirling, Scotland FK9 4LA
Phone: +44 (0)1786 467473
Fax: +44 (0)1786 467469
Web page: http://www.econ.stir.ac.uk/
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Keywords: air pollution; climate; life satisfaction; subjective well-being; hedonic pricing; happiness; environmental valuation;

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References

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Citations

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Cited by:
  1. Kopmann, Angela & Rehdanz, Katrin, 2013. "A human well-being approach for assessing the value of natural land areas," Ecological Economics, Elsevier, vol. 93(C), pages 20-33.
  2. Beja Jr., Edsel L., 2011. "Subjective Well-Being Approach to Environmental Valuation: Evidence for Greenhouse Gas Emissions," MPRA Paper 27862, University Library of Munich, Germany.
  3. Akay, Alpaslan & Brereton, Finbarr & Cunado, Juncal & Ferreira, Susana & Martinsson, Peter & Moro, Mirko & Ningal, Tine F, 2013. "Life Satisfaction and Air Quality in Europe," Stirling Economics Discussion Papers 2013-02, University of Stirling, Division of Economics.
  4. Katrin Rehdanz & Welsch Heinz & Daiju Naritaa & Toshihiro Okubod, 2013. "Well-being effects of a major negative externality: The case of Fukushima," Working Papers V-358-13, University of Oldenburg, Department of Economics, revised Jul 2013.
  5. Claudia Senik, 2013. "The French Unhappiness Puzzle: the Cultural Dimension of Happiness," Working Papers halshs-00628837, HAL.
  6. Menz, Tobias & Welsch, Heinz, 2010. "Population aging and environmental preferences in OECD countries: The case of air pollution," Ecological Economics, Elsevier, vol. 69(12), pages 2582-2589, October.
  7. Daniel Fujiwara, 2013. "A general method for valuing non-market goods using wellbeing data: three-stage wellbeing valuation," LSE Research Online Documents on Economics 51577, London School of Economics and Political Science, LSE Library.
  8. Ambrey, Christopher L. & Fleming, Christopher M. & Chan, Andrew Yiu-Chung, 2014. "Estimating the cost of air pollution in South East Queensland: An application of the life satisfaction non-market valuation approach," Ecological Economics, Elsevier, vol. 97(C), pages 172-181.
  9. Ambrey, Christopher L. & Fleming, Christopher M., 2012. "Public greenspace and life satisfaction in urban Australia," 2012 Conference (56th), February 7-10, 2012, Freemantle, Australia 124302, Australian Agricultural and Resource Economics Society.
  10. Juncal Cuñado & Fernando Gracia, 2013. "Environment and Happiness: New Evidence for Spain," Social Indicators Research, Springer, vol. 112(3), pages 549-567, July.
  11. Ambrey, Christopher L. & Chan, Andrew Yiu-Chung & Fleming, Christopher M., 2013. "Estimating the cost of air pollution in South East Queensland: An application of the life satisfaction non-market valuation approach," 2013 Conference (57th), February 5-8, 2013, Sydney, Australia 152133, Australian Agricultural and Resource Economics Society.
  12. Heinz Welsch & Philipp Biermann, 2013. "Electricity Supply Preferences in Europe: Evidence from Subjective Well-Being Data," Working Papers V-359-13, University of Oldenburg, Department of Economics, revised Aug 2013.
  13. Beja, Edsel Jr., 2011. "Subjective well-being approach to the valuation of income inequality," MPRA Paper 34177, University Library of Munich, Germany.
  14. Alem, Yonas & Colmer, Jonathan, 2013. "Optimal Expectations and the Welfare Cost of Climate Variability," Working Papers in Economics 578, University of Gothenburg, Department of Economics.
  15. Oswald, Andrew J., 2012. "The Value to the Environmental Movement of the New Literature on the Economics of Happiness," The Warwick Economics Research Paper Series (TWERPS) 997, University of Warwick, Department of Economics.
  16. Daniel Fujiwara, 2013. "A General Method for Valuing Non-Market Goods Using Wellbeing Data: Three-Stage Wellbeing Valuation," CEP Discussion Papers dp1233, Centre for Economic Performance, LSE.
  17. Yonas Alem & Jonathan Colmer, 2013. "Don’t Worry, Be Happy: The Welfare Cost of Climate Variability – A Subjective Well-Being Approach," Grantham Research Institute on Climate Change and the Environment Working Papers 118, Grantham Research Institute on Climate Change and the Environment.
  18. Paul Dolan & Daniel Fujiwara & Robert Metcalfe, 2011. "A Step towards Valuing Utility the Marginal and Cardinal Way," CEP Discussion Papers dp1062, Centre for Economic Performance, LSE.
  19. Heinz Welsch & Jan Kühling, 2010. "Is Pro-Environmental Consumption Utility-Maximizing? Evidence from Subjective Well-Being Data," Working Papers V-322-10, University of Oldenburg, Department of Economics, revised Apr 2010.
  20. Ambrey, Christopher L. & Fleming, Christopher M., 2011. "Valuing Ecosystem Diversity in South East Queensland: A Life Satisfaction Approach," 2011 Conference, August 25-26, 2011, Nelson, New Zealand 115347, New Zealand Agricultural and Resource Economics Society.

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