Accounting for Negative, Zero and Positive Willingness to Pay for Landscape Change in a National Park

Citation

Hanley N, Colombo S, Kristrom B & Watson F (2008) Accounting for Negative, Zero and Positive Willingness to Pay for Landscape Change in a National Park. Stirling Economics Discussion Paper, 2008-10.

Abstract
In contingent valuation, despite the fact that many externalities manifest themselves as costs to some and benefits to others, most studies restrict willingness to pay to being non-negative. In this paper, we investigate the impact of allowing for negative, zero and positive preferences for prospective changes in woodland cover in two UK national parks, the Lake District and the Trossachs. An extended spike model is used to accomplish this. The policy implications of not allowing for negative values in terms of aggregate benefits are also investigated, by comparing the extended spike model with a simple spike making use of only zero and positive bids, and a model which considers positive bids only. We find that ignoring negative values over-states the aggregate benefits of a woodland planting project by up to 44%.

Keywords
contingent valuation; national parks; negative WTP; spike models; Forests and forestry Economic aspects Trossachs (Scotland); Forests and forestry Economic aspects Lake District (England); National parks and reserves Economic aspects Trossach (Scotland); National parks and reserves Economic aspects Lake District (England); Landscape assessment Great Britain

JEL codes

• D60: Welfare Economics: General
• Q20: Renewable Resources and Conservation: General

• SEDP-2008-10-Hanley-Colombo-Kristrom-Watson.pdf