Accounting for subsistence needs in non-market valuation: a simple proposal - Aix-Marseille Université Access content directly
Journal Articles Journal of Environmental Planning and Management Year : 2023

Accounting for subsistence needs in non-market valuation: a simple proposal

Victor Champonnois
Olivier Chanel

Abstract

Revealed and stated preference techniques are widely used to assess willingness to pay (WTP) for non-market goods as input to public and private decision-making. However, individuals first have to satisfy subsistence needs through market good consumption, which affects their ability to pay. We provide a methodological framework and derive a simple ex post adjustment factor to account for this effect. We quantify its impacts on the WTP for non-market goods and the ranking of projects theoretically, numerically and empirically. This confirms that non-adjusted WTP tends to be plutocratic: the views of the richest – whatever they are – are more likely to impact decision-making, potentially leading to ranking reversal between projects. We also suggest that the subsistence needs-based adjustment factor we propose has a role to play in value transfer procedures. The overall goal is a better representation of the entire population’s preferences with regard to non-market goods.
Fichier principal
Vignette du fichier
Champonnois_Chanel_Accounting-for-subsistence-needs-in-NMV_WP AMSE_March2022.pdf (1.28 Mo) Télécharger le fichier
Origin : Files produced by the author(s)

Dates and versions

hal-03620225 , version 1 (30-11-2022)

Identifiers

Cite

Victor Champonnois, Olivier Chanel. Accounting for subsistence needs in non-market valuation: a simple proposal. Journal of Environmental Planning and Management, 2023, 66 (5), pp.1037-1060. ⟨10.1080/09640568.2021.2008884⟩. ⟨hal-03620225⟩
143 View
18 Download

Altmetric

Share

Gmail Facebook Twitter LinkedIn More