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Dealing with preference uncertainty in contingent willingness to pay for a nature protection program: A new approach

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  • Voltaire, Louinord
  • Pirrone, Claudio
  • Bailly, Denis

Abstract

In this paper, we propose an alternative preference uncertainty measurement approach where respondents have the option to indicate their willingness to pay (WTP) for a nature protection program either as exact values or intervals from a payment card, depending on whether they are uncertain about their valuation. On the basis of their responses, we then estimate their degree of uncertainty. New within this study is that the respondent's degree of uncertainty is “revealed”, while it is “stated” in those using existing measurement methods. Three statistical models are used to explore the sources of respondent uncertainty. We also present a simple way of calculating the uncertainty adjusted mean WTP, and compare this to the one obtained from an interval regression. Our findings in terms of determinants of preference uncertainty are broadly consistent with a priori expectations. In addition, the uncertainty adjusted mean WTP is quite similar to the one derived from an interval regression. We conclude that our method is promising in accounting for preference uncertainty in WTP answers at little cost to interviewees in terms of time and cognitive effort, on the one hand, and without researcher assumptions regarding the interpretation of degrees of uncertainty reported by respondents, on the other.

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  • Voltaire, Louinord & Pirrone, Claudio & Bailly, Denis, 2013. "Dealing with preference uncertainty in contingent willingness to pay for a nature protection program: A new approach," Ecological Economics, Elsevier, vol. 88(C), pages 76-85.
  • Handle: RePEc:eee:ecolec:v:88:y:2013:i:c:p:76-85
    DOI: 10.1016/j.ecolecon.2013.01.009
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    Cited by:

    1. Marius Yapo & Jie He & Bruno Gagnon & Luc Savard & Roland Leduc, 2015. "La valeur économique pour l’amélioration de la qualité de l’eau: le cas de la rivière Magog et du lac Magog (Québec, Canada)," Cahiers de recherche 15-15, Departement d'Economique de l'École de gestion à l'Université de Sherbrooke.
    2. Gupta, Monika, 2016. "Willingness to pay for carbon tax: A study of Indian road passenger transport," Transport Policy, Elsevier, vol. 45(C), pages 46-54.
    3. repec:eee:ecolec:v:137:y:2017:i:c:p:47-55 is not listed on IDEAS
    4. repec:spr:waterr:v:31:y:2017:i:13:d:10.1007_s11269-017-1733-3 is not listed on IDEAS
    5. Braun, Carola & Rehdanz, Katrin & Schmidt, Ulrich, 2016. "Validity of Willingness to Pay Measures under Preference Uncertainty," Open Access Publications from Kiel Institute for the World Economy 141320, Kiel Institute for the World Economy (IfW).
    6. repec:wsi:wepxxx:v:03:y:2017:i:01:n:s2382624x16500193 is not listed on IDEAS
    7. Voltaire, Louinord, 2017. "Pricing Future Nature Reserves Through Contingent Valuation Data," Ecological Economics, Elsevier, vol. 135(C), pages 66-75.

    More about this item

    Keywords

    Contingent valuation; Preference uncertainty; Payment card; Uncertainty calibration; Willingness to pay; Nature protection;

    JEL classification:

    • Q20 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Renewable Resources and Conservation - - - General
    • Q26 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Renewable Resources and Conservation - - - Recreational Aspects of Natural Resources

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