Tuesday, December 6, 2011

Reducing protest responses by deliberative monetary valuation: Improving the validity of biodiversity valuation

Abstract: This paper focuses on examining the validity of biodiversity valuation methodologies. The results of a group deliberation technique (deliberative monetary valuation) are compared to those derived from a contingent valuation (CV) survey using the same environmental topic. Evidence is here presented that DMV can address some of the limitations of CV; namely a prevalence for lexicographic preference ordering due to psychological reasons and the lack of a priori or well-formed preferences. Both of these methodological shortcomings can result in protest responses which decrease the external validity of results. It is common environmental valuation methodology practice to exclude protest responses from the analysis on the grounds that they are illegitimate choices, thus the sample and consequently the environmental valuation analysis may become less representative of the population. An advantage of the DMV methodology is that it was found to significantly reduce the rate of protest responses to less than half (from 29% to 13%). Furthermore, DMV significantly increased the proportion of positive bids but not the amounts contributed. In relation to preference formation issues, we suggest rethinking the current practice of the DMV method, and propose dedicating the entire initial discussion session to introducing the good outside of a valuation context.

► Prevalence of protest responses decrease the validity of biodiversity valuation
► Deliberative Monetary Valuation is supplemented by a contingent valuation survey
► Methodological reasons of protesting: psychological reasons, unformed preferences
► Our interpretation of DMV halved the rate of protest responses
► DMV increased the proportion of positive bids but not the amounts contributed
Among deliberative forum participants the mean of the implied fair price of a modest improvement in biodiversity (Switch from conventional to environment friendly crop production program) was calculated at 26.1 Euro/year/person. As for healthy land use structure with up to a doubling of diversity (Agro-environmental program) a mean value of 41 Euro/year/person as a fair price emerged among those who participated in deliberations.
by Zoltán Szabó; Corvinus University of Budapest, Department of Environmental Economics and Technology, 1093, Fővám tér 8., Budapest, Hungary
Ecological Economics via Elsevier Science Direct www.sciencedirect.com
Volume 72; 15 December 2011; Pages 37-44
see also http://www.bioecon.ucl.ac.uk/12th_2010/Szabo.pdf
Keywords: Biodiversity valuation; Deliberative Monetary Valuation; Protest responses; Lexicographic preferences; Unformed preferences; Agriculture

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