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Estimating The Benefits Of Groundwater Contamination Control

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  • Sun, Henglun
  • Bergstrom, John C.
  • Dorfman, Jeffrey H.

Abstract

In this paper, a conceptual model for estimating option price for groundwater quality protection is developed, and the effets of subjective demand and supply uncertainty and other variables on option price are estimated. A contingent valuation study to measure option price for groundwater quality protection was conducted in southwestern Georgia. Valuation results suggest that the monetary benefits to citizens of protecting groundwater supplies from agricultural chemical contamination are quite large.

Suggested Citation

  • Sun, Henglun & Bergstrom, John C. & Dorfman, Jeffrey H., 1992. "Estimating The Benefits Of Groundwater Contamination Control," Southern Journal of Agricultural Economics, Southern Agricultural Economics Association, vol. 24(02), December.
  • Handle: RePEc:ags:sojoae:29641
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    References listed on IDEAS

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    1. Krinsky, Itzhak & Robb, A Leslie, 1986. "On Approximating the Statistical Properties of Elasticities," The Review of Economics and Statistics, MIT Press, vol. 68(4), pages 715-719, November.
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    3. Edwards, Steven F., 1988. "Option prices for groundwater protection," Journal of Environmental Economics and Management, Elsevier, vol. 15(4), pages 475-487, December.
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    5. David S. Brookshire & Larry S. Eubanks & Alan Randall, 1983. "Estimating Option Prices and Existence Values for Wildlife Resources," Land Economics, University of Wisconsin Press, vol. 59(1), pages 1-15.
    6. Sellar, Christine & Chavas, Jean-Paul & Stoll, John R., 1986. "Specification of the logit model: The case of valuation of nonmarket goods," Journal of Environmental Economics and Management, Elsevier, vol. 13(4), pages 382-390, December.
    7. Mark L. Plummer, 1986. "Supply Uncertainty, Option Price, and Option Value: An Extension," Land Economics, University of Wisconsin Press, vol. 62(3), pages 313-318.
    8. Brookshire, David S. & Ives, Berry C. & Schulze, William D., 1976. "The valuation of aesthetic preferences," Journal of Environmental Economics and Management, Elsevier, vol. 3(4), pages 325-346, December.
    9. Kahneman, Daniel & Knetsch, Jack L., 1992. "Valuing public goods: The purchase of moral satisfaction," Journal of Environmental Economics and Management, Elsevier, vol. 22(1), pages 57-70, January.
    10. Smith, V. Kerry, 1992. "Arbitrary values, good causes, and premature verdicts," Journal of Environmental Economics and Management, Elsevier, vol. 22(1), pages 71-89, January.
    11. Bergstrom, John C. & Stoll, John R. & Titre, John P. & Wright, Vernon L., 1990. "Economic value of wetlands-based recreation," Ecological Economics, Elsevier, vol. 2(2), pages 129-147, June.
    12. Desvousges, William H. & Smith, V. Kerry & Fisher, Ann, 1987. "Option price estimates for water quality improvements: A contingent valuation study for the monongahela river," Journal of Environmental Economics and Management, Elsevier, vol. 14(3), pages 248-267, September.
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    Citations

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    Cited by:

    1. Olivier Beaumais & Anne Briand & Katrin Millock & Céline Nauges, 2010. "What are Households Willing to Pay for Better Tap Water Quality ? A Cross-Country Valuation Study," Université Paris1 Panthéon-Sorbonne (Post-Print and Working Papers) halshs-00497453, HAL.
    2. Hrubovcak, James & Vasavada, Utpal & Aldy, Joseph E., 1999. "Green Technologies for a More Sustainable Agriculture," Agricultural Information Bulletins 33721, United States Department of Agriculture, Economic Research Service.
    3. Mukherjee, Sacchidananda, 2008. "Factors influencing farmers\u2019 willingness to protect groundwater from nonpoint source of pollution in the Lower Bhavani River Basin, Tamil Nadu," Conference Papers h041886, International Water Management Institute.
    4. John C. Whitehead & George Van Houtven, "undated". "Methods for Valuing the Benefits of the Safe Drinking Water Act: Review and Assessment," Working Papers 9705, East Carolina University, Department of Economics.
    5. Charles F. Mason & Lucija A. Muehlenbachs & Sheila M. Olmstead, 2015. "The Economics of Shale Gas Development," Annual Review of Resource Economics, Annual Reviews, vol. 7(1), pages 269-289, October.
    6. repec:kap:iaecre:v:3:y:1997:i:3:p:299-311 is not listed on IDEAS
    7. Gregory Poe & Richard Bishop, 1999. "Valuing the Incremental Benefits of Groundwater Protection when Exposure Levels are Known," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 13(3), pages 341-367, April.
    8. John Bergstrom & Kevin Boyle & Mitsuyasu Yabe, 2004. "Trading Taxes vs. Paying Taxes to Value and Finance Public Environmental Goods," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 28(4), pages 533-549, August.
    9. Souter, Ray A. & Bowker, James Michael, 1996. "A Note On Nonlinearity Bias And Dichotomous Choice Cvm: Implications For Aggregate Benefits Estimation," Agricultural and Resource Economics Review, Northeastern Agricultural and Resource Economics Association, vol. 25(1), April.
    10. Peterson, Jeffrey M. & Boisvert, Richard N., 1998. "Optimal Voluntary "Green" Payment Programs To Limit Nitrate Contamination Under Price and Yield Risk," Research Bulletins 122687, Cornell University, Department of Applied Economics and Management.
    11. Allen, James C. & Bergstrom, John C., 2003. "Measuring Values For Wetlands Protection In A Developing Country From Domestic And International Citizen Groups," 2003 Annual meeting, July 27-30, Montreal, Canada 22009, American Agricultural Economics Association (New Name 2008: Agricultural and Applied Economics Association).
    12. Poe, Gregory L. & Boyle, Kevin J. & Bergstrom, John C., 2000. "A Meta Analysis Of Contingent Values For Groundwater Quality In The United States," 2000 Annual meeting, July 30-August 2, Tampa, FL 21871, American Agricultural Economics Association (New Name 2008: Agricultural and Applied Economics Association).
    13. Zhang, Fan & Fogarty, James, 2015. "Nonmarket Valuation of Water Sensitive Cities: Current Knowledge and Issues," Working Papers 207694, University of Western Australia, School of Agricultural and Resource Economics.
    14. Thomas, Arthur C. & Boisvert, Richard N., 1995. "The Bioeconomics Of Regulating Nitrates In Groundwater From Agricultural Production Through Taxes, Quantity Restrictions, And Pollution Permits," Research Bulletins 122999, Cornell University, Department of Applied Economics and Management.
    15. Peter A. Groothuis & George Van Houtven & John C. Whitehead, 1998. "Using Contingent Valuation to Measure the Compensation Required to Gain Community Acceptance of a Lulu: the Case of a Hazardous Waste Disposal Facility," Public Finance Review, , vol. 26(3), pages 231-249, May.
    16. Painter, Kathleen M. & Young, Douglas L., 1994. "Environmental And Economic Impacts Of Agricultural Policy Reform: An Interregional Comparison," Journal of Agricultural and Applied Economics, Southern Agricultural Economics Association, vol. 26(02), December.
    17. Parveen Setia & Bengt Hyberg & Daniel Ugarte & Daryll Ray, 1997. "Planting flexibility: Implications for agricultural sustainability," International Advances in Economic Research, Springer;International Atlantic Economic Society, vol. 3(3), pages 299-311, August.

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    Keywords

    Environmental Economics and Policy;

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