IDEAS home Printed from https://ideas.repec.org/a/eee/jeeman/v57y2009i1p45-64.html
   My bibliography  Save this article

Non-price equilibria for non-marketed goods

Author

Listed:
  • Phaneuf, Daniel J.
  • Carbone, Jared C.
  • Herriges, Joseph A.

Abstract

As part of the Resources for the Future Frontiers of Environmental Economics collection of papers, we consider the problem of general equilibrium feedback effects in non-price space as they relate to non-market valuation. Our overall objective is to examine the extent to which non-price equilibria arising from both simple and complex sorting behavior can be empirically modeled and the resulting differences in partial and general equilibrium welfare measures quantified. After motivating the problem, in general, we consider the specific context of congestion in recreation demand applications, which we classify as the outcome of a simple sorting equilibrium. Using both econometric and computable general equilibrium (CGE) models, we examine the conceptual and computational challenges associated with this class of problems and present findings on promising solution avenues. We demonstrate the relevance of accounting for congestion effects in recreation demand with an application to lake visits in Iowa. Our econometric and CGE results confirm that, for some plausible counterfactual scenarios, substantial differences exist between partial and general equilibrium welfare estimates. We conclude the paper by describing tasks that are needed to move forward research in this area.

Suggested Citation

  • Phaneuf, Daniel J. & Carbone, Jared C. & Herriges, Joseph A., 2009. "Non-price equilibria for non-marketed goods," Journal of Environmental Economics and Management, Elsevier, vol. 57(1), pages 45-64, January.
  • Handle: RePEc:eee:jeeman:v:57:y:2009:i:1:p:45-64
    as

    Download full text from publisher

    File URL: http://www.sciencedirect.com/science/article/pii/S0095-0696(08)00096-X
    Download Restriction: Full text for ScienceDirect subscribers only

    As the access to this document is restricted, you may want to look for a different version below or search for a different version of it.

    Other versions of this item:

    References listed on IDEAS

    as
    1. Timmins, Christopher & Murdock, Jennifer, 2007. "A revealed preference approach to the measurement of congestion in travel cost models," Journal of Environmental Economics and Management, Elsevier, vol. 53(2), pages 230-249, March.
    2. Daniel J. Phaneuf & Catherine L. Kling & Joseph A. Herriges, 2000. "Estimation and Welfare Calculations in a Generalized Corner Solution Model with an Application to Recreation Demand," The Review of Economics and Statistics, MIT Press, vol. 82(1), pages 83-92, February.
    3. von Haefen, Roger H. & Phaneuf, Daniel J., 2008. "Identifying demand parameters in the presence of unobservables: A combined revealed and stated preference approach," Journal of Environmental Economics and Management, Elsevier, vol. 56(1), pages 19-32, July.
    4. Patrick Bayer & Christopher Timmins, 2007. "Estimating Equilibrium Models Of Sorting Across Locations," Economic Journal, Royal Economic Society, vol. 117(518), pages 353-374, March.
    5. Smith, Martin D. & Zhang, Junjie & Coleman, Felicia C., 2008. "Econometric modeling of fisheries with complex life histories: Avoiding biological management failures," Journal of Environmental Economics and Management, Elsevier, vol. 55(3), pages 265-280, May.
    6. von Haefen R.H. & Phaneuf D.J. & Parsons G.R., 2004. "Estimation and Welfare Analysis With Large Demand Systems," Journal of Business & Economic Statistics, American Statistical Association, vol. 22, pages 194-205, April.
    7. Massey, D. Matthew & Newbold, Stephen C. & Gentner, Brad, 2006. "Valuing water quality changes using a bioeconomic model of a coastal recreational fishery," Journal of Environmental Economics and Management, Elsevier, vol. 52(1), pages 482-500, July.
    8. Walsh, Randy, 2007. "Endogenous open space amenities in a locational equilibrium," Journal of Urban Economics, Elsevier, vol. 61(2), pages 319-344, March.
    9. Charles F. Manski, 2000. "Economic Analysis of Social Interactions," Journal of Economic Perspectives, American Economic Association, vol. 14(3), pages 115-136, Summer.
    10. Kerry Smith, V. & Sieg, Holger & Spencer Banzhaf, H. & Walsh, Randall P., 2004. "General equilibrium benefits for environmental improvements: projected ozone reductions under EPA's Prospective Analysis for the Los Angeles air basin," Journal of Environmental Economics and Management, Elsevier, vol. 47(3), pages 559-584, May.
    11. Murdock, Jennifer, 2006. "Handling unobserved site characteristics in random utility models of recreation demand," Journal of Environmental Economics and Management, Elsevier, vol. 51(1), pages 1-25, January.
    12. Lee, Lung-Fei & Pitt, Mark M, 1986. "Microeconometric Demand Systems with Binding Nonnegativity Constraints: The Dual Approach," Econometrica, Econometric Society, vol. 54(5), pages 1237-1242, September.
    13. Steven T. Berry, 1994. "Estimating Discrete-Choice Models of Product Differentiation," RAND Journal of Economics, The RAND Corporation, vol. 25(2), pages 242-262, Summer.
    14. Phaneuf, Daniel J., 1999. "A Dual Approach to Modeling Corner Solutions in Recreation Demand," Journal of Environmental Economics and Management, Elsevier, vol. 37(1), pages 85-105, January.
    15. Sha Yang & Yuxin Chen & Greg Allenby, 2003. "Reply to Comments on “Bayesian Analysis of Simultaneous Demand and Supply”," Quantitative Marketing and Economics (QME), Springer, vol. 1(3), pages 299-304, September.
    16. Berry, Steven & Levinsohn, James & Pakes, Ariel, 1995. "Automobile Prices in Market Equilibrium," Econometrica, Econometric Society, vol. 63(4), pages 841-890, July.
    17. Sha Yang & Yuxin Chen & Greg Allenby, 2003. "Bayesian Analysis of Simultaneous Demand and Supply," Quantitative Marketing and Economics (QME), Springer, vol. 1(3), pages 251-275, September.
    18. Bayer, Patrick & Timmins, Christopher, 2005. "On the equilibrium properties of locational sorting models," Journal of Urban Economics, Elsevier, vol. 57(3), pages 462-477, May.
    19. Carbone, Jared C. & Smith, V. Kerry, 2008. "Evaluating policy interventions with general equilibrium externalities," Journal of Public Economics, Elsevier, vol. 92(5-6), pages 1254-1274, June.
    20. LaFrance, Jeffrey T., 1985. "Linear demand functions in theory and practice," Journal of Economic Theory, Elsevier, vol. 37(1), pages 147-166, October.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Michael O’Hara, 2013. "Empirical identification of perceived congestion," Empirical Economics, Springer, vol. 45(3), pages 1167-1187, December.
    2. repec:eee:jeeman:v:88:y:2018:i:c:p:159-179 is not listed on IDEAS
    3. Angel Bujosa & Antoni Riera & Robert Hicks & Kenneth McConnell, 2015. "Densities Rather than Shares: Improving the Measurement of Congestion in Recreation Demand Models," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 61(2), pages 127-140, June.
    4. von Haefen, Roger H., 2010. "Incomplete Demand Systems, Corner Solutions, and Welfare Measurement," Agricultural and Resource Economics Review, Northeastern Agricultural and Resource Economics Association, vol. 0(Number 1), pages 1-15, February.
    5. Carbone, Jared C. & Kerry Smith, V., 2013. "Valuing nature in a general equilibrium," Journal of Environmental Economics and Management, Elsevier, vol. 66(1), pages 72-89.
    6. repec:eee:ecolec:v:137:y:2017:i:c:p:1-12 is not listed on IDEAS
    7. Melstrom, Richard & Lupi, Frank, 2012. "Using a Control Function to Resolve the Travel Cost Endogeneity Problem in Recreation Demand Models," MPRA Paper 48036, University Library of Munich, Germany, revised May 2013.
    8. Llop Llop, Maria, 2016. "A second-best analysis of alternative instruments for the preservation of natural resources?," Working Papers 2072/261533, Universitat Rovira i Virgili, Department of Economics.
    9. Xenarios, Stefanos & Amarasinghe, Upali & Sharma, Bharat R., 2011. "Valuating agricultural water use and ecological services in agrarian economies: evidences from eastern India," IWMI Research Reports H043778, International Water Management Institute.
    10. Wiktor L. Adamowicz & Klaus Glenk & Jürgen Meyerhoff, 2014. "Choice modelling research in environmental and resource economics," Chapters,in: Handbook of Choice Modelling, chapter 27, pages 661-674 Edward Elgar Publishing.

    More about this item

    Keywords

    Non-market valuation General equilibrium Recreation demand CGE modeling Quality-differentiated demand;

    JEL classification:

    • Q20 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Renewable Resources and Conservation - - - General

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:eee:jeeman:v:57:y:2009:i:1:p:45-64. See general information about how to correct material in RePEc.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Dana Niculescu). General contact details of provider: http://www.elsevier.com/locate/inca/622870 .

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service hosted by the Research Division of the Federal Reserve Bank of St. Louis . RePEc uses bibliographic data supplied by the respective publishers.