Valuing Biodiversity: A comparison of compensating surplus and compensating tax reallocation

Mark Morrison, Darla Hatton McDonald

Research output: Book chapter/Published conference paperConference paper

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Abstract

The use of most non-market valuation techniques is predicated on respondents payingadditional amounts of money for increased provision of a public good. However, in manycircumstances this may not be appropriate if the increased provision can be funded througha reallocation of existing expenditures, or if respondents reject the notion of an additionalpayment. This paper demonstrates a methodology for estimating compensating taxreallocation, which is the amount of expenditure on other public goods that respondents arewilling to forego for the government to provide more of another public good. Thisapproach is compared with the standard approach of estimating compensating surplus.Choice modelling is utilised for both approaches. The two approaches produce aggregateresults that are of a similar order of magnitude, however the relative importance of theenvironmental attributes differs across the two approaches.
Original languageEnglish
Title of host publicationThird World Congress of Environmental and Resource Economists
Pages1-25
Number of pages25
Publication statusPublished - 2006
EventThird World Congress of Environmental and Resource Economists - Kyoto, Japan, Japan
Duration: 03 Jul 200607 Jul 2006

Conference

ConferenceThird World Congress of Environmental and Resource Economists
CountryJapan
Period03/07/0607/07/06

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