When is some number really better than no number? On the optimal choice between non-market valuation methods

Munro, Alistair (2007): When is some number really better than no number? On the optimal choice between non-market valuation methods.

Abstract

Decision-makers have a wide variety of competing and complementary methods for non-market valuation, but there is little formal advice on the choice of method. I offer a formal approach, using a loss function (the mean square error) to compare contingent valuation, Citizens'Jury and methods where by intention only a portion of total value is estimated, when a) preferences vary across the population and b) methods are more or less susceptible to framing effects. Illustrative simulations suggest con-ditions under which the Citizens'Jury may dominate contingent valuation when framing effects are significant.

• Item Type: MPRA Paper
• Language: English
• Keywords: contingent valuation; Citizens' Jury; optimal decisions; framing effects; cost-benefit analysis
• Subjects: D - Microeconomics > D6 - Welfare Economics > D61 - Allocative Efficiency ; Cost-Benefit Analysis; Q - Agricultural and Natural Resource Economics ; Environmental and Ecological Economics > Q5 - Environmental Economics > Q51 - Valuation of Environmental Effects; D - Microeconomics > D0 - General > D01 - Microeconomic Behavior: Underlying Principles

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