Climate change impacts on the hydrological cycle are altering the quantity, quality, and temporal... more Climate change impacts on the hydrological cycle are altering the quantity, quality, and temporal distribution of riverine discharge, necessitating a more rigorous consideration of changes in land cover and land use. This study establishes relationships between different land cover combinations (e.g. percentages of forest-both native and exoticand pastureland) and hydrological services, using hydrological indices estimated at annual and seasonal timescales in an area with a steep precipitation gradient (900-2600 mm yr −1). Using discharge data from 20 catchments in the Bay of Biscay, a climate transition zone, the study applied multiple regression models to better understand how the interaction between precipitation and land cover combinations influence hydrological services. Findings showed the relationship between land cover combinations and hydrological services is highly dependent on the amount of precipitation, even in a climatically homogeneous and relatively small area. In general, in the Bay of Biscay area, the greater presence of any type of forests is associated with lower annual water resources, especially with greater percentages of exotic plantations and high annual precipitation. Where precipitation is low, forests show more potential to reduce annual and winter high flows than pasturelands, but this potential decreases as annual or seasonal precipitation increases. As annual precipitation increases, low flows increase as the percentage of exotic plantations decreases and pasturelands increase. Results obtained in this study improve understanding of the multiple effects of land cover on hydrological services, and illustrate the relevance of land planning to the management of water resources, especially under a climate change scenario.
This paper shows that cultural identity may have considerable influence on the WTP to protect nat... more This paper shows that cultural identity may have considerable influence on the WTP to protect natural resources. The Basque Country, the region with the highest ethnic homogeneity in Europe, serves as an example to illustrate how important this issue can be in the environmental valuation of natural resources. The rationale for this influence may be found in the deep roots of the Basque culture, a culture where amalurra (mother Earth), i.e. the natural environment, has a central role, as studies from diverse disciplines such as anthropology, psychology and political science have shown. Simulated full distribution of the WTP to protect a Basque natural area using a random parameter logit model reveals that mean marginal WTP to protect its environmental attributes is approximately 60% higher if the cultural identity of the respondent is Basque. To our knowledge, this is the first application to show the influence of cultural identity on the WTP to protect natural resources. Our findings have some methodological and policy implications. On the one hand, failure to take into account cultural identitary issues could result in significantly biased results in benefit transfer applications. On the other hand, policies aimed at conservation natural resources should consider the cultural context in which they will be implemented.
Modern forms of energy are an important vehicle towards poverty alleviation in rural areas of dev... more Modern forms of energy are an important vehicle towards poverty alleviation in rural areas of developing countries. Mo s t d e v e l o p i n g c o u n t r i e s ' h o u s e h o l d s heavily rely on wood fuel which impact their health and social-economic status. To ease such a dependency, other modern forms of energy, namely electricity, need to be provided. However, the quality of the electricity service, namely reliability, is an important factor in reducing this dependency. This paper discusses a choice experiment valuation study conducted among electrified rural households located in Kisumu, Kenya, in which the willingness to pay (WTP) to avoid power outages or blackouts was estimated. A mixed logit estimation was applied to identify the various socioeconomic and demographic characteristics which determine preferences to reduce power outages among a h o u s e h o l d ' s users. In conclusion, several of the socioeconomic and demographic characteristics outlined in this paper were identified and can assist service differentiation to accommodate the diverse households' preferences towards the improvement of the electricity service.
This paper examines the various tests commonly used to select random parameters in choice modelli... more This paper examines the various tests commonly used to select random parameters in choice modelling. The most common procedures for selecting random parameters are: the Lagrange Multiplier test as proposed by McFadden and Train (2000), the t-statistic of the deviation of the random parameter and the log-likelihood ratio test. The identification of random parameters in other words the recognition of preference heterogeneity among population is based on the fact that an individual makes a choice depending on her/his: tastes, perceptions and experiences. A simulation experiment was carried out based on a real choice experiment and the results indicated that the power of these three tests depends importantly on the spread and type of the tested parameter distribution.
This chapter concerns different aspects of validity and reliability of a discrete choice experime... more This chapter concerns different aspects of validity and reliability of a discrete choice experiment. Firstly, it focuses on three essential concepts for assessing the validity of the welfare estimates obtained in the choice experiment, namely content, construct and criterion validity. Secondly, it discusses how the reliability of the recorded choices can be assessed. It then discusses issues related to model comparison and selection. Finally, it addresses prediction in discrete choice models as a way to assess the quality of a model. 8.1 The Three Cs: Content, Construct and Criterion Validity While goodness-of-fit measures and prediction success may be used to assess the validity of the econometric model, broader aspects of validity of the obtained value estimates should also be assessed when conducting DCE surveys. In general, the overarching goal of most applied environmental DCE surveys is to provide welfare measures that mirror as accurately as possible the actual values of the target population. A DCE survey with the highest level of validity would be one that produces WTP estimates that are identical to the true WTPs in the population. However, given that true values cannot be observed for non-marketed environmental changes, such a direct and simple test of the validity of a DCE survey is not available. Instead, the validity of welfare measures obtained from a DCE survey will have to be assessed through more indirect indicators. Different classifications of validity testing can be found in the valuation literature as well as in the broader survey literature (e.g. Bateman et al. 2002; Scherpenzeel and Saris 1997). In a recent paper, Bishop and Boyle (2019) present an overview and a useful framework for considering validity as well as reliability of non-market valuation surveys. They outline three different aspects of validity, referred to as "the Three Cs": content validity, construct validity and criterion validity. All three are important for assessing the validity of welfare estimates obtained from an environmental DCE survey. Content validity concerns the extent to which the chosen valuation method, as well as all aspects of its practical implementation, is appropriate and conducive for
This chapter focuses on the calculation of marginal and non-marginal welfare measures. It outline... more This chapter focuses on the calculation of marginal and non-marginal welfare measures. It outlines how the calculation of welfare measures is related to the specified model and the assumptions underlying that model. It further describes how the calculation of these measures is affected by the inclusion of preference heterogeneity, including the incorporation of interaction terms to capture observed preference heterogeneity or random parameters to capture unobserved preference heterogeneity. Finally, it discusses how these measures can be aggregated and compared.
Modely reakce prodeje na reklamu [Sales Advertising Response Models]
Politicka Ekonomie, 1998
This paper surveys dynamic models in the field of advertising. After a brief introduction to the ... more This paper surveys dynamic models in the field of advertising. After a brief introduction to the differential game theory some sales-advertising response models are described. These models are organised under five headings: Vidale-Wolfe generalisations, Lanchester-type models, Leitmann models, Excess advertising models and Combined models. This up-to date review of the existing literature in this field compares specification of models, analysed optimal strategies and obtained results.
Impulsivity and task complexity in a latent variable choice model applied to environmental valuation
This paper analyzes the issue of choice task complexity represented by five design dimensions (th... more This paper analyzes the issue of choice task complexity represented by five design dimensions (the number of choice sets, alternatives, attributes, attribute levels and their range) on discrete choice model outcomes in the context of environmental valuation. The case study is based on a nation-wide online survey carried out in Germany about land use changes. The survey incorporates aspects of land use changes, such as the share of forests or land conversion as well as different biodiversity attributes. Respondents were requested to value the land use changes in a 15km surrounding of their place of residence. Similar to Hensher (2004), for example, a design of designs approach was used resulting in sixteen different split samples. The effect of task complexity on model outcomes is analyzed in a plain Random Parameter Logit (RPL) and in a Hybrid Choice Model (HCM) which incorporates respondents’ attitudes (Ben-Akiva et al., 2002). HCM is expected to provide better insights into individuals’ choice behavior recognizing their latent nature while at the same time avoiding problems such as endogeneity and measurement error when incorporating these attitudes directly as explanatory variables in choice models. Apart from that virtue, HCM allows for decomposition of the preference heterogeneity into a purely random part and a part related to attitudes (Vij and Walker, 2012). It allows a deeper understanding of the role of socio-demographics, and, subsequently, better policy recommendations. In our case, the additional information incorporated to the choice model is represented by responses to attitudinal questions related to impulsivity. It is a multifactorial construct that comprises, among other things, a tendency to act on a whim, displaying behavior characterized by little or no forethought, reflection, or consideration of the consequences. We measured impulsiveness using an item battery developed by Kovaleva et al (2012). We expect that respondents who reveal a higher degree of impulsivity use different informaion processing strategies and thus, there are more likely to choose the status quo alternative, especially when they face a choice set with a higher dimensionality. Therefore, HCM allows analysis of the interaction between task complexity and impulsivity in a comprehensive hybrid choice model framework. The HCM applied includes structural equations based on the random utility theory, structural equation for the latent variable and measurement equations which use the values of the attitudinal indicators as dependent variables. The model takes into account the repeated choice nature of the data as well as the ordinal nature of the indicators. Our results confirm findings from other studies indicating that respondents’ choices are, apart from the attributes of the alternatives, related to individual characteristics such as attitudes or part of their personality trait. These multifactorial constructs allow for an analysis of the existing preference heterogeneity through the linking of attribute coefficients to socio-demographic variables by the use of these underlying constructs. These results are compared to a plain RPL model in which the same socio-demographic variables affect the means of the random parameters. RPL and HCM outcomes are very similar, nevertheless, as expected, the HCM leads to more precise estimations as additional information on attitudinal indicators is used by the estimation procedure. The paper raises also some methodological issues related to HCMs. The first issue is related to the definition of the latent constructs used in hybrid models. The definition of these construct should be based on well proved set of questions and, if possible, it should be based on a theoretical background similar to “locus of control” or “environmental beliefs”. The applications should also include exploratory analysis of the indicators which confirm the dimensions of the underlying constructs. The paper decomposes the overall heterogeneity to show what part of it is linked to the latent attitude construct. The second issue is related to validation of the HCMs. An additional validation apart from simple coefficients testing and LogL comparison is usually not included in DCM applications. The paper highlights the importance of validation and shows a possible way to validate HCMs based on out-of-sample forecasting. References: Ben-Akiva, M., McFadden, D., Train, K., Walker, J., Bhat, C., Bierlaire, M., Bolduc, D., Boersch-Supan, A., Brownstone, D., Bunch, D.S., Daly, A., De Palma, A., Gopinath, D., Karlstrom, A. Munizaga, M. (2002). Hybrid choice models: progress and challenges. Marketing Letters 13(3), 163–175. DOI 10.1023/A:1020254301302 Hensher DA (2004) Identifying the influence of stated choice design dimensionality on willingness to pay for travel time savings. J Transp Econ Policy 38:425–446 Kovaleva, Beierlein, kemper, Rammstedt (2012) Eine Kurzskala zur Messung von Impulsivitat nach dem…
Exploring job preferences of business and economics students from Colombia, Ecuador and Spain: a discrete choice experiment
International Journal of Manpower
Purpose This study analyses the future job characteristics that are preferred by economics and bu... more Purpose This study analyses the future job characteristics that are preferred by economics and business administration students in three specific regions of Spain, Colombia and Ecuador, and estimates their willingness to accept each.Design/methodology/approach A discrete choice experiment (DCE) is carried out in these three regions. The econometric approach is based on the Random Parameter Logit model, which accounts for both the observed and unobserved heterogeneity by the use of socio-demographic variables and correlated random parameters.Findings The main conclusions indicate that the most important job characteristic for students in all three countries is the long-term career prospects at the company, while a permanent contract is one of the least important job attributes. Regarding the more specific conclusions related to each country, the Ecuadorian students seem to have a higher preference for training opportunities, given the strong relationship between the level of educatio...
This chapter focuses on the calculation of marginal and non-marginal welfare measures. It outline... more This chapter focuses on the calculation of marginal and non-marginal welfare measures. It outlines how the calculation of welfare measures is related to the specified model and the assumptions underlying that model. It further describes how the calculation of these measures is affected by the inclusion of preference heterogeneity, including the incorporation of interaction terms to capture observed preference heterogeneity or random parameters to capture unobserved preference heterogeneity. Finally, it discusses how these measures can be aggregated and compared.
Este trabajo analiza la demanda residencial española en electricidad, gas natural , gas licuado d... more Este trabajo analiza la demanda residencial española en electricidad, gas natural , gas licuado de petróleo (GLP) y combustibles líquidos utilizando un modelo QUAIDS. Debido a que no todos los hogares consumen todos los combustibles a la vez, este modelo es adaptado para considerar la censura. Los datos utilizados pertenecen a la Encuesta de Presupuestos Familiares (EPF) de 2013. Los resultados indican que la demanda de electricidad y combustible líquido tienen una elasticidad precio inelástica, mientras que el gas natural y el GLP tienen demandas sensibles a las variaciones de sus precios. Además todos los combustibles son bienes normales, pero la de-manda de GLP es la más sensible a los cambios del ingreso familiar. Palabras clave: demanda residencial de energía, modelo QUAIDS, censura. Clasificación JEL: C34, C36, Q48, Q49. U na de las principales razones para promover la eficiencia energética es la ne-cesidad de compatibilizar el desarrollo económico y la emisión de los gases de...
Using a latent variable choice model to capture heterogeneous attitudes and preferences toward the landscape externalities of wind power generation
This paper incorporates individuals’ attitudes in a discrete choice model by applying an Integrat... more This paper incorporates individuals’ attitudes in a discrete choice model by applying an Integrated Choice and Latent Variable (ICLV) model (Ben-Akiva et al., 2002; Bolduc et al., 2005) ICLV models are expected to provide better insights into individuals’ choice behavior recognizing their latent nature while at the same time avoiding problems such as endogeneity and measurement error when incorporating these attitudes directly as explanatory variables in choice models. The model and has been used in various fields (Daly et al., 2012; Glerum et al., 2012; Hess and Beharry-Borg, 2012). We jointly estimate attitudinal and choice models using a case study concerned with the valuation of landscape externalities of wind power generation by analyzing the role of latent attitudes in environmental context and taking into account the repeated choice nature of the data. The ordinal nature of the indicators is taken into account by using an ordered logit structure for their incorporation in th...
This chapter starts by briefly presenting the theoretical background of welfare economics and int... more This chapter starts by briefly presenting the theoretical background of welfare economics and introducing key aspects such as the indirect utility function, the expenditure function, or the concepts of compensating surplus or equivalent surplus. Next, it draws attention to willingness to pay and willingness to accept, essential measures in environmental valuation. Finally, the chapter summarises the basic mathematical notation of the random utility maximisation models used throughout the book.
Environmental Valuation with Discrete Choice Experiments, 2020
This chapter is devoted to advanced issues of econometric modelling. The topics covered are, amon... more This chapter is devoted to advanced issues of econometric modelling. The topics covered are, among others, models in willingness to pay space, the meaning of scale heterogeneity in discrete choice models and the application of various information processing rules such as random regret minimisation or attribute non-attendance. Other topics are anchoring and learning effects when respondents move through a sequence of choice tasks as well as different information processing strategies such as lexicographic preferences or choices based on elimination-by-aspects.
Environmental Valuation with Discrete Choice Experiments, 2020
This chapter outlines the essential topics for developing and testing a questionnaire for a discr... more This chapter outlines the essential topics for developing and testing a questionnaire for a discrete choice experiment survey. It addresses issues such as the description of the environmental good, pretesting of the survey, incentive compatibility, consequentiality or mitigation of hypothetical bias. For the latter, cheap talk scripts, opt-out reminders or an oath script are discussed. Moreover, the use of instructional choice sets, the identification of protest responses and strategic bidders are considered. Finally, issues related to the payment vehicle and the cost vector design are the subject of this section.
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