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

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  • 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
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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: environmental valuation; happiness; hedonic pricing; subjective well-being; life satisfaction; climate; air pollution;

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References

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