The Scope Effect in Multiple Species Valuation

62 Pages Posted: 15 Apr 2022

See all articles by Ram Pandit

Ram Pandit

The University of Western Australia

Michael Burton

The University of Western Australia

Asha Gunawardena

The University of Western Australia

Stephen T. Garnett

Charles Darwin University

Kerstin K. Zander

Charles Darwin University

David J. Pannell

University of Western Australia

Abstract

Scope insensitivity in stated preference studies has been widely debated in empirical literature with mixed evidence. We investigate this in the context of threatened species conservation across Australia by conducting three discrete choice experiments. The choice experiments followed the same structure where species, used as attributes, were shown in the same order, but the designs varied in the number of species presented as options to be conserved: three, five or eight. For three and five species cases, an explicit partial-profile design was used. Using data collected through online surveys, we use a mixed-logit model in willingness-to-pay (WTP) space to estimate WTP for reducing each species’ extinction risk. WTP to conserve a species differs with the number of species presented. We observed a clear pattern: the higher the number of species in a design, the lower the people’s WTP for a species. This observation is reinforced when comparing the results to a related study using the same species but a single-species design. Results suggest that we failed to find evidence of the ‘scope’ effect. Therefore, policies to conserve threatened species need to be holistic and consider all threatened species collectively as WTP estimates reported from single-species-based studies may not be additive.

Keywords: Choice experiment, Partial profile design, Scope sensitivity, Threatened species conservation, Willingness to pay space

Suggested Citation

Pandit, Ram and Burton, Michael and Gunawardena, Asha and Garnett, Stephen T. and Zander, Kerstin K. and Pannell, David J., The Scope Effect in Multiple Species Valuation. Available at SSRN: https://ssrn.com/abstract=4084339 or http://dx.doi.org/10.2139/ssrn.4084339

Ram Pandit (Contact Author)

The University of Western Australia ( email )

35 Stirling Highway
Crawley, 6009
Australia

Michael Burton

The University of Western Australia ( email )

35 Stirling Highway
Crawley, Western Australia 6009
Australia

Asha Gunawardena

The University of Western Australia ( email )

35 Stirling Highway
Crawley, 6009
Australia

Stephen T. Garnett

Charles Darwin University ( email )

Kerstin K. Zander

Charles Darwin University ( email )

David J. Pannell

University of Western Australia ( email )

35 Stirling Highway
Crawley, Western Australia 6009
AUSTRALIA
(08) 9844 8659 (Phone)
(08) 9844 8659 (Fax)

HOME PAGE: http://www.general.uwa.edu.au/u/dpannell/welcome.html

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