Preference Formation and Elicitation in Valuing Non-Market Goods

EPA Grant Number: R824679
Title: Preference Formation and Elicitation in Valuing Non-Market Goods
Investigators: Brookshire, David S. , Kaplan, Hillard , McKee, Michael , Berrens, Robert , Jenkins, Hank , Ganderton, Philip
Institution: University of New Mexico
EPA Project Officer: Hahn, Intaek
Project Period: October 1, 1995 through September 30, 1997
Project Amount: $184,998
RFA: Valuation and Environmental Policy (1995) RFA Text |  Recipients Lists
Research Category: Environmental Justice

Description:

The general research objective of this interdisciplinary project is to investigate the interaction between value formation and value elicitation. The basic premise is that an understanding of how individuals form environmental values (e.g., purchase versus contribution model) cannot be decoupled from the value statement problem and the choice of elicitation mechanism. The corollary premise is that social context is an important, but relatively unexplored, determinant of both value formation and value statement.

Social context effects may be at work at both a larger level (in the attitudes and beliefs of respondents concerning particular environmental policies) and within the highly structured stated preference communication process. Once recognized, a variety of testable hypotheses can be generated. It is hypothesized that the multi-dimensional nature of many environmental policies may generate both positive and negative passive use values, that there may be significant social desirability response effects for some environmental policy changes, and that the relative magnitude of these effects may be influenced by individual characteristics, attitudes, and the methods employed for eliciting values. Likewise, it is hypothesized that nonresponse and protest response behavior may be influenced by individual characteristics, attitudes, and the elicitation mechanism.

The methods to be employed in this research will include a unique combination and sequencing of field surveys and laboratory experiments. The field research will be a series of telephone surveys, with some sample treatments augmented by informational mailings, to address valuation questions and to collect detailed demographic and attitudinal information. The field research will be integrated with a series of laboratory experiments on public goods provision. Both field research and lab experiments yield unique insights (the richness and variability of field data versus the highly controlled nature of the lab). The structure of this research is designed to combine these insights. For example, a comparison of actual versus hypothetical payment for an environmental public good will be made in the lab and validated against the econometric estimates of stated preferences in the field. The application of these methods will be targeted to environmental issues of southwestern ecosystems. While not tied to a particular policy case, the focus on protection of riparian areas and instream flows, and ecological restoration of rangelands will provide general policy relevance. Pilot studies have been initiated on these topics, and will be complemented by a set of focus groups to identify all important dimensions of the environmental goods.

The results of this research will aid in the assessment of current stated preference methods and guidelines, and expand the knowledge of the interaction between value formation and value elicitation. Improved understanding of social context will provide a clear advancement in the use and design of stated preference approaches. Important incremental gains will also be provided by empirical validation of the multidimensional nature of environmental values, identification of the presence and relative magnitude of social desirability effects, and the characterization and treatment of nonresponse and protest behavior.

Supplemental Keywords:

RFA, Economic, Social, & Behavioral Science Research Program, Scientific Discipline, decision-making, Ecology and Ecosystems, Social Science, Economics & Decision Making, ecosystem valuation, multi-objective decision making, policy analysis, public resources, social psychology, compensation, empirical validation, social impact analysis, valuation, community involvement, decision analysis, economic benefits, environmental assets, value elicitation, economic incentives, environmental values, information dissemination, preference formation, standards of value, environmental policy, psychological attitudes, public values, social resistance, public policy, stated preference

Progress and Final Reports:

  • 1996
  • Final