Preferences and Valuation for Environmental Goods: Theory and Evidence

Paper Session

Friday, Jan. 6, 2017 10:15 AM – 12:15 PM

Sheraton Grand Chicago, Jackson Park
Hosted By: Association of Christian Economists
  • Chair: Kristen Cooper, Gordon College

Environmental Economics and Christian Ethics

Spencer Banzhaf
,
Georgia State University

Abstract

In public discourse, one often hears about a conflict between economics and the natural environment. However, over the course of the 20th century, economics evolved from the study of material wealth to the study of tradeoffs themselves. Accordingly, the profession came to speak, not in terms of economics versus the environment, but of an economics of the environment. Theologically, this move essentially locates the origin of the economic concept of "opportunity cost" not so much in the fall, as often believed, but in finite creation itself. This talk will discuss this history and speculate on implications of this move for some theological critiques of markets.

Economic Betterment (Value): Are All Betterments Commensurable? And, are you capable of comparing the relief from a fix for global warming with the pleasure of chocolate?

Edward Morey
,
University of Colorado-Boulder

Abstract

The choice theory that supports the valuation of ecological and environmental resources assumes you have a full ranking of paths (states-of-the-world) in terms of betterment. Assumption: Experiencing a higher-ranked path is better for you, from your perspective, than experiencing a lower-ranked path. Where: Every path for you is a conceivable life and world as it would unfold through time, including its ecological resources. Ranking paths requires that all of your different feelings and thoughts are commensurable in terms of how they affect betterment (all types of betterment and worsement collapse onto one dimension). Even if you know in what way and to what extent each aspect of each conceivable path betters you, it still might be impossible to collapse those betterments onto one dimension. For example,you have to be able to compare the betterment caused by dates with Wanda with the betterment caused by saving gorillas, and caused by saving gorillas vs. religious freedom. In opposition to choice theory, many people reject complete benefit commensurability. This note summarizes the arguments and findings.

Preferences for the Environment: A Subjective Well-Being/Stated Preference Survey Approach

Daniel J. Benjamin
,
University of Southern California
Kristen Cooper
,
Gordon College
Ori Heffetz
,
Cornell University
Miles Kimball
,
University of Colorado Boulder

Abstract

What aspects of environmental quality do people most prefer, and what are they willing to trade off for these goods? We study these questions using a new survey which combines subjective well-being questions about the levels of aspects of well-being with stated preference questions about trade-offs between the aspects. We collected data from an online convenience sample which covered a long list of aspects, including everything from “you feeling connected to nature” to “people not being cruel to animals” and “you not having to worry about ecological catastrophes.” We estimate relative marginal utilities for all the aspects and compare environmentally-oriented aspects to others like job security, family happiness, and sense of purpose. We also assess the relationship between preferences and demographics, including religious and political views, and explore whether our results are consistent with an overarching “preference for the environment.

The Role of Perceptions and Expectations in Supporting Land Conservation

Corey Lang
,
University of Rhode Island
Shanna Pearson-Merkowitz
,
University of Rhode Island

Abstract

As urban sprawl continues and the agricultural and forest lands that help define rural community character are lost, it is critical to assess voter support for land conservation. In this study, we develop a national, online survey of approximately 1000 respondents, oversampling areas with a high degree of land development. First, this survey seeks to understand individual-level socioeconomic determinants of support for conservation. Second, we investigate how perceptions of land use change and expected impacts of conservation (e.g., housing price increases, environmental quality improvements, reducing the inflow of new or different types of residents) may affect support for conservation. We expect these findings to serve community groups, local/state legislators, and town managers who desire to preserve open space. This research should help them to craft their message to legislators and the public about why open space is worthwhile and to understand the factors that may generate opposition to their proposals.
Discussant(s)
Edd Noell
,
Westmont College
Steve McMullen
,
Hope College
Daniel Hungerman
,
University of Notre Dame
Spencer Banzhaf
,
Georgia State University
JEL Classifications
  • Q5 - Environmental Economics