The complexity of biodiversity: A biological perspective on economic valuation

To value something, you first have to know what it is. Bartkowski et al. (2015) reveal a critical weakness: that biodiversity has rarely, if ever, been defined in economic valuations of putative biodiversity. Here we argue that a precise definition is available and could help focus valuation studies, but that in using this scientific definition (a three-dimensional measure of total difference), valuation by stated-preference methods becomes, at best, very difficult.We reclassify the valuation studies reviewed by Bartkowski et al. (2015) to better reflect the biological definition of biodiversity and its potential indirect use value as the support for provisioning and regulating services. Our analysis shows that almost all of the studies reviewed by Bartkowski et al. (2015) were not about biodiversity, but rather were about the 'vague notion' of naturalness, or sometimes a specific biological component of diversity. Alternative economic methods should be found to value biodiversity as it is defined in natural science. We suggest options based on a production function analogy or cost-based methods. Particularly the first of these provides a strong link between economic theory and ecological research and is empirically practical. Since applied science emphasizes a scientific definition of biodiversity in the design and justification of conservation plans, the need for economic valuation of this quantitative meaning of biodiversity is considerable and as yet unfulfilled.

Stated preference methods and landscape ecology indicators: an example of transdisciplinarity in landscape economic valuation

This paper addresses the representation of landscape complexity in stated preferences research. It integrates landscape ecology and landscape economics and conducts the landscape analysis in a three-dimensional space to provide ecologically meaningful quantitative landscape indicators that are used as variables for the monetary valuation of landscape in a stated preferences study. Expected heterogeneity in taste intensity across respondents is addressed with a mixed logit model in Willingness to Pay space. Our methodology is applied to value, in monetary terms, the landscape of the Sorrento Peninsula in Italy, an area that has faced increasing pressure from urbanization affecting its traditional horticultural, herbaceous, and arboreal structure, with loss of biodiversity, and an increasing risk of landslides. We find that residents of the Sorrento Peninsula would prefer landscapes characterized by large open views and natural features. Residents also appear to dislike heterogeneous landscapes and the presence of lemon orchards and farmers' stewardship, which are associated with the current failure of protecting the traditional landscape. The outcomes suggest that the use of landscape ecology metrics in a stated preferences model may be an effective way to move forward integrated methodologies to better understand and represent landscape and its complexity.

A contingent valuation of the 2012 London Olympic games - A regional perspective

Major sporting events such as the Olympics are usually assessed in terms of economic impacts. Recently, policy makers have begun to place greater emphasis on possible intangible effects (such as civic pride, legacy of sporting facilities) associated with such events. To date, little work has been carried out on quantifying these effects in a meaningful way. This study uses contingent valuation methodology to assess the value of the proposed 2012 London Olympic Games. The survey is carried out on the provincial city of Bath, approximately 2 hours west of London. Conducting the survey outside of London is justified on the basis that the organizers of London 2012 have emphasized the value of the event to the United Kingdom as a whole. The results suggest that positive intangible effects are associated with the event and residents outside of London are willing to pay toward funding.

Sequence Effects in the Valuation of Multiple Environmental Programs Using the Contingent Valuation Method

In contingent valuation, the willingness to pay for hypothetical programs may be affected by the order in which programs are presented to respondents. With inclusive lists, economic theory suggests that sequence effects should be expected. However, when policy makers allocate public budgets to several environmental programs, they may be interested in assessing the value of the programs without the valuations being affected by the order in which the programs are presented. Using single-bounded dichotomous choice contingent valuation questions, we show that if respondents have the possibility to revise their willingness-to-pay answers, sequence effects are mitigated. (JEL Q51, Q54)

Economic modelling of antenatal screening and ultrasound scanning programmes for identification of fetal abnormalities

Objective Within the framework of a health technology assessment and using an economic model, to determine the most clinically and cost effective policy of scanning and screening for fetal abnormalities in early pregnancy. Design A discrete event simulation model of 50,000 singleton pregnancies. Setting Maternity services in Scotland. Population Women during the first 24 weeks of their pregnancy. Methods The mathematical model was populated with data on uptake of screening, prevalence, detection and false positive rates for eight fetal abnormalities and with costs for ultrasound scanning and serum screening. Inclusion of abnormalities was based on the relative prevalence and clinical importance of conditions and the availability of data. Six strategies for the identification of abnormalities prenatally including combinations of first and second trimester ultrasound scanning and first and second trimester screening for chromosomal abnormalities were compared. Main outcome measures The number of abnormalities detected and missed, the number of iatrogenic losses resulting from invasive tests, the total cost of strategies and the cost per abnormality detected were compared between strategies. Results First trimester screening for chromosomal abnormalities costs more than second trimester screening but results in fewer iatrogenic losses. Strategies which include a second trimester ultrasound scan result in more abnormalities being detected and have lower costs per anomaly detected. Conclusions The preferred strategy includes both first and second trimester ultrasound scans and a first trimester screening test for chromosomal abnormalities. It has been recommended that this policy is offered to all women in Scotland.

Economic cost of age-related macular degeneration: a review of recent research

As the population of most developed countries ages so the prevalence of diseases such as age-related macular degeneration (AMD) are likely to increase. To facilitate planning and informed debate regarding making provisions for this disease it is important that we have a clear understanding of the economic impact of visual impairment associated with AMD. In this paper we assess the state of current knowledge based on a review of published evidence in scientific journals. Based on our assessment of the evidence we argue that the paucity of research studies on the subject and wide variation in estimates produced from the few studies available make it difficult to assess with confidence the likely average direct cost-of-illness associated with AMD. We further argue that significant gaps in our understanding of the costs of AMD (particularly in respect of indirect costs) also exist. Current research should be augmented by more comprehensive studies.