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More than the Sum of their Parts: Valuing Environmental Quality by Combining Life Satisfaction Surveys and GIS Data

Author

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  • Jérôme Silva

    (OECD)

  • Zachary Brown

    (OECD)

Abstract

While environmental economics studies using stated life satisfaction data have been gaining attention, much of this body of work remains exploratory. In this study we contribute to this emerging body of research by combining OECD survey data from four European countries on life satisfaction and perceptions of environmental quality with independent (i.e. mechanical) measurements of air quality and urbanity, from the European Environment Agency, to provide a broad picture of the environmental determinants of life satisfaction, and monetary valuation of air quality improvements. We also estimate that the value of a 1% reduction in air pollution (measured as mean annual PM10 concentrations) is worth the same on average as a 0.71% increase in per capita income. We find that environments which respondents perceive as noisy and lacking in access to green space have a significantly detrimental impact on life satisfaction. However, controlling for these negative factors (air, noise, and lack of green space), we also find a large positive residual impact of urban environments on life satisfaction. The use of independent, GIS-based measures of urbanity (proportion of urban surface area around households), as opposed to survey-based stated perceptions of urbanity, increases the precision of estimated air quality impacts on life satisfaction. Taken as a whole, our analysis highlights the need for conducting LS-based environmental assessment and valuation exercises using a broad array of independent data sources, in order both to obtain unbiased regression estimates and to facilitate interpretation of these estimates. Alors que les études sur l’économie de l’environnement qui font appel à des données sur la satisfaction déclarée à l’égard de l’existence suscitent un intérêt grandissant, ces travaux conservent pour beaucoup d’entre eux un caractère exploratoire. Dans cette étude, nous apportons une contribution à ce domaine de recherche émergent en combinant des données issues d’enquêtes menées par l’OCDE dans quatre pays européens sur la satisfaction à l’égard de la vie et la qualité perçue de l’environnement, avec des mesures indépendantes (mécaniques) de la qualité de l’air et du caractère urbain provenant de l’Agence européenne pour l’environnement, dans le but de dresser un tableau général des déterminants environnementaux de la satisfaction à l’égard de la vie et de produire une évaluation monétaire des améliorations de la qualité de l’air. Nous estimons également qu’une réduction de 1 % de la pollution de l’air (mesurée comme la concentration annuelle moyenne de PM10) a la même valeur en moyenne qu’une hausse de 0.71 % du revenu par habitant. Nous constatons que les milieux perçus par les répondants comme bruyants et manquant de possibilités d’accès à des espaces verts ont un effet négatif sensible sur la satisfaction à l’égard de la vie. Cependant, si nous neutralisons l’effet de ces facteurs négatifs (air, bruit et manque d’espèces verts), nous observons aussi un fort impact résiduel positif des milieux urbains sur la satisfaction à l’égard de la vie. Le fait de recourir à des systèmes d’information géographique pour obtenir des mesures indépendantes du caractère urbain (en l’occurrence, la proportion de surfaces urbanisées autour du foyer), au lieu de s’en remettre aux appréciations sur ce point des répondants aux enquêtes, permet des estimations plus précises de l’impact de la qualité de l’air sur la satisfaction à l’égard de la vie. Dans l’ensemble, notre analyse met en lumière la nécessité de faire appel à un large éventail de sources de données indépendantes pour conduire des évaluations environnementales fondées sur la satisfaction à l’égard de la vie, afin d’obtenir des estimations par régression sans biais et de faciliter l’interprétation de ces estimations.

Suggested Citation

  • Jérôme Silva & Zachary Brown, 2013. "More than the Sum of their Parts: Valuing Environmental Quality by Combining Life Satisfaction Surveys and GIS Data," OECD Statistics Working Papers 2013/1, OECD Publishing.
  • Handle: RePEc:oec:stdaaa:2013/1-en
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    File URL: http://dx.doi.org/10.1787/5k4840hfpwkb-en
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    Keywords

    environmental valuation; life satisfaction;

    JEL classification:

    • C21 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Cross-Sectional Models; Spatial Models; Treatment Effect Models
    • H23 - Public Economics - - Taxation, Subsidies, and Revenue - - - Externalities; Redistributive Effects; Environmental Taxes and Subsidies
    • H41 - Public Economics - - Publicly Provided Goods - - - Public Goods
    • Q51 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Valuation of Environmental Effects
    • Q53 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Air Pollution; Water Pollution; Noise; Hazardous Waste; Solid Waste; Recycling
    • R20 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Household Analysis - - - General

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