Optimal Decision Processes: On the Choice Between Environmental Valuation Methods

29 Pages Posted: 19 Jul 2007

See all articles by Alistair Munro

Alistair Munro

National Graduate Institute for Policy Studies (GRIPS); University of London, Royal Holloway College - Department of Economics

Date Written: 2007

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 conditions under which the Citizens' Jury may dominate contingent valuation when framing effects are significant.

Keywords: contingent valuation, optimal decisions, Citizens' Jury

JEL Classification: D61, H43, Q26

Suggested Citation

Munro, Alistair, Optimal Decision Processes: On the Choice Between Environmental Valuation Methods (2007). Available at SSRN: https://ssrn.com/abstract=1001651 or http://dx.doi.org/10.2139/ssrn.1001651

Alistair Munro (Contact Author)

National Graduate Institute for Policy Studies (GRIPS) ( email )

Tokyo
Japan

HOME PAGE: http://www.grips.ac.jp/

University of London, Royal Holloway College - Department of Economics ( email )

Royal Holloway College
Egham
Surrey, Surrey TW20 0EX
United Kingdom

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