A Mire of Discount Rates: Delaying Conservation Payment Schedules in a Choice Experiment
Ioanna Grammatikopoulou (),
Janne Artell (),
Turo Hjerppe and
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Ioanna Grammatikopoulou: Natural Resources Institute Finland (Luke)
Turo Hjerppe: Finnish Environment Institute
Eija Pouta: Natural Resources Institute Finland (Luke)
Environmental & Resource Economics, 2020, vol. 77, issue 3, No 6, 615-639
Abstract Studies on the public’s implicit discount rate in the willingness to pay for environmental amenities have mostly employed contingent valuation surveys. We investigate respondents’ time preferences using choice experiments with four payment schedules in a split-sample design in the context of mire conservation. We first examine preference and taste heterogeneity among respondents, finding them to a large extent independent of payment schedules. Next we use an endogenous approach to jointly estimate the implicit discount rates and preferences using choice experiments data. We explore exponential and hyperbolic discounting model specifications. We find insensitivity to the length of the payment period and support for hyperbolic discounting. Furthermore, we provide policy relevant valuation results concerning mire conservation.
Keywords: Exponential discounting; Hyperbolic discounting; Choice experiment; Mixed logit model (search for similar items in EconPapers)
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