Journal of Forest Economics > Vol 10 > Issue 2

A comparison of a parametric and a non-parametric method to value a non-rejectable public good

Maria L. Loureiro, , maria.loureiro@usc.es John B. Loomis, , Laura Nahuelhual, ,
 
Suggested Citation
Maria L. Loureiro, John B. Loomis and Laura Nahuelhual (2004), "A comparison of a parametric and a non-parametric method to value a non-rejectable public good", Journal of Forest Economics: Vol. 10: No. 2, pp 61-74. http://dx.doi.org/10.1016/j.jfe.2004.05.002

Published: 14 Sep 2004
© 0 2004 Maria L. Loureiro, John B. Loomis, Laura Nahuelhual
 
Subjects
 
Keywords
JEL Codes:Q230Q510
CompensationPrescribed burningPublic badWillingness to acceptWillingness to pay
 

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In this article:
Introduction
Previous studies
Methods and applications
Results
Discussion

Abstract

Some public programs jointly provide a mix of public goods and bads. Consequently, some individuals would pay for the program, while others would not, and might instead need compensation. We provide a parametric and a non-parametric modeling approach to estimate a net willingness to pay (WTP of gainers minus WTA of losers) for a non-rejectable mixed public-good/public-bad. We illustrate the models using data on valuation of prescribed burning of underbrush in forests, which reduces the risk of catastrophic wildfires but produces smoke emissions (the public bad). We compare the two empirical approaches to estimate the net WTP for the program.

DOI:10.1016/j.jfe.2004.05.002