I believe that air pollution and water pollution, particularly ocean waters, are conducive to using contingent valuation. This is because both of these forms of pollution are easily dispersed into pristine and unused natural environments. In this way CV is particularly suited to develop lost existence values for areas that are being damaged by these emissions. In turn, the ‘real’ cost of damaging areas like untouched forest and oceanic reef ecosystems can be used to push firms to incur the cost of improved pollution mitigation systems. This should result in firms actually reaching the socially optimized level of pollution reduction and better preserve areas crucial to sustaining life on Earth.By the same token, CV would not be well suited for instances of highly publicized situations or those in which pollution is not widespread. This is because areas with relatively localized pollution are not likely in the heart of pristine environments and lost existence values would not apply. Further, the pollution may only affect a small number of people who would likely feel very strongly about it. In highly publicized scenarios people will have developed strong opinions on the issue well before participating in the valuation process. In both situations peoples’ judgment is likely compromised and they may be more inclined to produce responses that are inconsistent with rational choice, as the Hausman article point out can be a problem of CV. The end result would be valuation figures that are not reliable and probably extremely beyond what people would actually be willing to pay.
4 comments:
I agree that CV is not a good tool in highly publicized environmental issues. I can see how the publicity an issue receives could easily skew a CV survey. In this case, I think the analysts would have to be careful to conpensate for the increased attention an issue had received. However, if the issue have received a lot of publicity, it is likely to be addressed regardless of the existance of a valid CV study.
I agree with your points regarding data that is skewed by highly publicized scenarios as well as situations that only involved a small number of people that feel strongly about the situation. Regarding the situations that you think CV is appropriate for, do you think CV valuation tends to estimate a higher cost?
I might be in the minority here, but I do not agree (totally) that CV may not be used in highly public issues.
Let me clarify that. I believe that utilizing the public scrutiny to:
1. Invite all public to be more active.
2. Open to all results (demonstrated).
3. Build a public and two-way dialogue.
4. Inform, educate and activate.
5. Expand diversity, dialogue and COUNTER MEDIA fragmentation.
6. Create other opportunities of public agenda setting.
After you achieve these, then the use of CV and their surveys might be a good and proper tool.
I think I tend to agree with Maria on this one. I do believe that highly polarized issues might make CV analysis harder, but how do you ask someone to essentially vote on alternatives that they know nothing about? I think it is particularly difficult because CV surveys are supposed to use referendum style question like "would you pay to clean up X for Y amount of increased taxes." How am I supposed to answer that if I don't know what X is or what the effects of not cleaning it up are?
Post a Comment