Stated Preference Methods & Valuing Surface Water Quality Improvements

This seminar will describe the use of Stated Preference (SP) methods, a survey-based technique often used by economists to estimate the benefits of environmental policies. Focusing on improvements in surface water quality, Dr. Dennis Guignet  describes why SP methods are sometimes needed and demonstrate an application using a recent study of the Chesapeake Bay Total Maximum Daily Loads. He then describes one of the biggest challenges economists face in designing a valid SP survey instrument—what is the appropriate metric to measure and communicate improvements in environmental quality? This is a particular challenge when trying to define the commodity using a consistent metric across heterogeneous environmental features, over broader geographic regions. Dennis compares and contrasts the approach taken in the above Chesapeake Bay study with an alternative index-based approach. In particular, he discusses a proposed metric of aquatic ecosystem health that could potentially be applied across the contiguous United States and elicits feedback on this preliminary metric and the available data.