Estimating the value of achieving good ecological status across Irish water catchments using value transfer

There has been considerable debate over the robustness of value transfer methods for environmental policy evaluation. The empirical findings regarding the transfer validity of such methods have been particularly mixed. This paper presents a novel value transfer approach that uses spatial microsimulation in the value function transfer. The results of a contingent valuation exercise that estimates the value to the Irish general public of achieving good ecological status, as specified in the Water Framework Directive, are transferred to a spatial microsimulation population within individual water management units (WMUs) across Ireland. The welfare estimates from this value function based transfer approach are compared against the results from previous primary valuation studies in one of the WMUs and transfer errors are found to be low. The proposed spatial microsimulation value transfer approach controls for the heterogeneous distribution of populations across the WMUs. It also controls for the fact that the willingness to pay will vary according to an individual’s geographic proximity to the water body within each catchment and with the current ecological status of the WMU.