The role of stated preference valuation methods in understanding choices and informing policy

Hanley, N. and Czajkowski, M. (2019) The role of stated preference valuation methods in understanding choices and informing policy. Review of Environmental Economics and Policy, 13(2), pp. 248-266. (doi: 10.1093/reep/rez005)

Abstract

This article examines the role of stated preference (SP) valuation methods in the environmental economist’s toolbox. Overall, the article makes the case for using SP methods in a wide range of settings, showing how the approach can be used to both inform policy and gain a better understanding of people’s choices and preferences. First, we provide an overview of SP methods and discuss a number of policy design issues where we believe SP methods have advantages over alternative approaches. The ability of SP to overcome “hypothetical market bias” is briefly reviewed. Next, we discuss how SP methods can be used to address research issues concerning people’s preferences and choices, which have broader implications for economics and behavioral sciences. These research issues are (1) the effects of information, learning and knowledge; (2) testing the validity of the standard model of consumer choice; (3) the influence of behavioral drivers such as social norms; and (4) the role of “deep” determinants of preference heterogeneity such as emotions and personality. Finally, we identify some research areas where SP methods may be particularly useful in the future.

• Item Type: Articles
• Status: Published
• Refereed: Yes
• Glasgow Author(s) Enlighten ID: Hanley, Professor Nicholas
• Authors: Hanley, N., and Czajkowski, M.
• College/School: College of Medical Veterinary and Life Sciences > School of Biodiversity, One Health & Veterinary Medicine
• Journal Name: Review of Environmental Economics and Policy
• Publisher: Oxford University Press
• ISSN: 1750-6816
• ISSN (Online): 1750-6824
• Published Online: 02 July 2019
• Copyright Holders: Copyright © 2019 The Authors
• First Published: First published in Review of Environmental Economics and Policy 13(2): 248-266
• Publisher Policy: Reproduced in accordance with the publisher copyright policy