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Choice modelling approaches: a superior alternative for environmental valuation?

Hanley, N. and Mourato, S. and Wright, R.E. (2002) Choice modelling approaches: a superior alternative for environmental valuation? OECD Economic Surveys, 15 (3). pp. 435-462. ISSN 0376-6438

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Abstract

In this paper, we examine some popular 'choice modelling' approaches to environmental valuation, which can be considered as alternatives to more familiar valuation techniques based on stated preferences such as the contingent valuation method. A number of choice modelling methods are consistent with consumer theory, and its focus on an attribute-based theory of value permits a superior representation of many environmental management contexts. However, choice modelling surveys can place a severe cognitive burden upon respondents and induce satisficing rather than maximising behavioural patterns. In this framework, we seek to identify the best available choice modelling alternative and investigate its potential to 'solve' some of the major biases associated with standard contingent valuation. We then discuss its use in the light of policy appraisal needs within the EU. An application to the demand for rock climbing in Scotland is provided as an illustration.