A comparison of stated preference methods for environmental valuation

This paper presents an empirical comparison of contingent valuation (CVM) and choice experiments which are used to value environmental quality changes, Both of these methods require individuals to state their preferences for environmental qualities. However, choice experiments differ from CVM in that environmental attributes are varied in an experimental design which requires respondents to make repeated choices between bundles of attributes. The empirical application involved the effect of environmental quality changes arising from forest management practices on recreational moose hunting values. Significant differences were found between the values derived from the two methods. However, detailed examination of the implied choice behaviour suggested that respondents ignored substitute recreation areas in the CVM question. Restricting the choice experiment model to consider only the one site where quality was varied, resulted in welfare estimates similar to the CVM model. This highlights the importance of substitutes in environmental valuation and suggests that choice experiments may be more appropriate than CVM in some cases.