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Inferred valuation versus conventional contingent valuation: A salinity intrusion case study.

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Title: Inferred valuation versus conventional contingent valuation: A salinity intrusion case study.
Authors: Khong, Tien Dung1,2 (AUTHOR) ktdung@ctu.edu.vn, Loch, Adam1 (AUTHOR), Young, Michael D.1 (AUTHOR)
Source: Journal of Environmental Management. Aug2019, Vol. 243, p95-104. 10p.
Subjects: Contingent valuation, Valuation, Social desirability, Salinity, Government policy, River deltas
Geographic Terms: Mekong River Delta (Vietnam & Cambodia), Vietnam
Abstract: People's willingness-to-pay values may be inflated by a variety of influences (e.g. hypothetical bias), which means that stated preference validity tests remain relevant. Recently developed inferred valuation approaches may serve to identify and/or reduce inflated stated preference values. However, economic applications of inferred valuation approaches are relatively limited in the literature, and the evidence remains mixed. This paper examines farmers' willingness-to-pay for salinity intrusion mitigation programs in the Mekong River Delta of Vietnam using both conventional contingent and inferred valuation approaches. Inferred valuation estimates were as much as 31 per cent lower than conventional estimates of willingness-to-pay, and averaged about 24 per cent lower across the groups. We discuss these findings, and the role that commitment costs and provision point mechanism payment vehicles may play. Public policy implications for any future salinity intrusion mitigation program are also outlined. • Social desirability bias reduction potential is explored using inferred valuation. • Inferred valuation estimates reveal lower values than conventional direct questions. • Willing-to-pay determinants are consistent across different valuation approaches. • Direct and indirect techniques are essential for public good policy implementation. [ABSTRACT FROM AUTHOR]
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Database: Engineering Source
Description
Abstract:People's willingness-to-pay values may be inflated by a variety of influences (e.g. hypothetical bias), which means that stated preference validity tests remain relevant. Recently developed inferred valuation approaches may serve to identify and/or reduce inflated stated preference values. However, economic applications of inferred valuation approaches are relatively limited in the literature, and the evidence remains mixed. This paper examines farmers' willingness-to-pay for salinity intrusion mitigation programs in the Mekong River Delta of Vietnam using both conventional contingent and inferred valuation approaches. Inferred valuation estimates were as much as 31 per cent lower than conventional estimates of willingness-to-pay, and averaged about 24 per cent lower across the groups. We discuss these findings, and the role that commitment costs and provision point mechanism payment vehicles may play. Public policy implications for any future salinity intrusion mitigation program are also outlined. • Social desirability bias reduction potential is explored using inferred valuation. • Inferred valuation estimates reveal lower values than conventional direct questions. • Willing-to-pay determinants are consistent across different valuation approaches. • Direct and indirect techniques are essential for public good policy implementation. [ABSTRACT FROM AUTHOR]
ISSN:03014797
DOI:10.1016/j.jenvman.2019.05.009