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Attribute causality in environmental choice modelling

journal contribution
posted on 06.12.2017, 00:00 by R Blamey, M Morrison, J Bennett, J Louviere, John RolfeJohn Rolfe
When selecting attributes in environmental Choice Modelling studies, preference should be given to those attributes that are demand-relevant, policy-relevant, and measurable. The use of these criteria will often result in a short list of environmental attributes of which some are causally related. The inclusion of attributes that have a “cause-effect” relationship may stimulate some respondents to seek to understand the causal relations among attributes in order to assign greater meaning to the alternatives, and potentially, simplify the decision making process. This may have implications for the weights they assign to each of the attributes when identifying the preferred alternatives, and subsequently for the implicit prices and/or welfare estimates. A test of the impact of including an attribute that causes impacts on ecosystem health as well as an attribute relating to ecosystem health effects on parameter estimates, implicit prices and welfare estimates is conducted. Two questionnaires are developed, one with the ‘causal’ attribute included and one without. A comparison of results indicates that when the ‘causal’ attribute is included in the vector of choice attributes, the implicit value of a single endangered species falls by 34 per cent whilst no significant difference is detected in the parameter estimates. Importantly, however, estimates of compensating surplus for a given policy package do not differ significantly across the two treatments. This implies that to the extent that the inclusion of a ‘causal’ attribute reduces the implicit prices for one or more of the ‘effect’ attributes, the associated loss in utility is approximately offset by the utility now associated with the new attribute.

Funding

Category 1 - Australian Competitive Grants (this includes ARC, NHMRC)

History

Volume

23

Issue

2

Start Page

167

End Page

186

Number of Pages

20

ISSN

0924-6460

Location

The Netherlands

Publisher

Kluwer Academic

Language

en-aus

Peer Reviewed

Yes

Open Access

No

External Author Affiliations

Australian National University; Charles Sturt University; Faculty of Business and Law; Memetrics Pty Ltd, Sydney;

Era Eligible

No

Journal

Environmental and resource economics.

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