Perspectives on valuing water quality improvements using stated preference methods

Ian Bateman, Bonnie Keeler, Sheila M. Olmstead and John Whitehead
Additional contact information
Bonnie Keeler: b Center for Science, Technology and Environmental Policy, Hubert H. Humphrey School of Public Affairs, University of Minnesota , Minneapolis , MN 55455
Sheila M. Olmstead: c Lyndon B. Johnson School of Public Affairs, The University of Texas at Austin , Austin , TX 78713-8925
John Whitehead: d Department of Economics, Appalachian State University , Boone , NC 28608

Proceedings of the National Academy of Sciences, 2023, vol. 120, issue 18, e2217456120

Abstract:

Improvements to the quality of freshwater rivers and lakes can generate a wide array of benefits, from “use values†such as recreational boating, fishing, and swimming to “nonuse values†such as improved outcomes for aquatic biodiversity. Bringing these nonmarket values into decision-making is crucial to determining appropriate levels of investment in water quality improvements. However, progress in the economic valuation of water quality benefits has lagged similar efforts to value air quality benefits, with implications for water policy. New data sources, modeling techniques, and innovation in stated preference survey methods offer notable improvements to estimates of use and nonuse benefits of improved water quality. Here, we provide a perspective on how recent applications of stated preference techniques to the valuation of the nonmarket benefits of water quality improvements have advanced the field of environmental valuation. This overview is structured around four key questions: i) What is it about water quality that we seek to value? ii) How should we design and implement the surveys which elicit individuals’ stated preferences? iii) How do we assess the validity of the findings provided by such studies? and iv) What are the contributions of these valuation exercises to public policy? In answering these questions, we make reference to the contributions provided by the papers in this Symposium.

Keywords: economics; valuation; water quality; stated preference (search for similar items in EconPapers)
Date: 2023
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