Analytical Methodologies
Stated Preference Methods
Contingent Valuation
The contingent valuation (CV) method uses surveys to directly elicit individuals' preferences and willingness to pay (WTP) for nonmarket goods, such as improvements in environmental quality. Examples of RTI's experience in conducting CV studies include analyses of
- Local improvements in air and water quality
- Protection of forest ecosystem services
- Alternative swine waste management policies
- Vaccinations against infectious disease.
Conjoint Analysis
Conjoint analysis uses surveys to estimate the relative importance and value individuals associate with different attributes of a commodity. Like CV, conjoint analyses often use respondents' stated choices to estimate WTP for nonmarket commodities and/or attributes. Examples of RTI's experience in conducting conjoint studies include analyses of
- Winter use management options at Yellowstone National Park
- Safe drinking water and sanitation services in several developing countries
- Preferences for avoiding fatal accident and cancer risks
- Risk-benefit tradeoffs related to drug treatments.
Revealed Preference Methods
Hedonic Price Methods
Hedonic price methods treat market goods/services as bundles of attributes. They use econometric techniques to decompose market prices into "shadow prices" (i.e., values) for individual attributes. These attributes may include local environmental quality for residential properties and occupational risks for jobs. Examples of RTI's experience in conducting hedonic studies include analyses of the effect of
- Urban forests on local housing prices
- Water levels on lakefront property values
- Open space and changes in land use patterns on housing markets.
Recreation Demand and Travel Cost Methods
Recreation demand and travel cost methods use data on recreation behaviors to estimate individuals' values for outdoor recreation activities and for the natural resources that support these activities. Examples of RTI's experience in conducting travel cost studies include analyses that have estimated
- Recreation values for snowmobiling in national parks
- Water quality benefits for recreational trout fishing
- Recreation values for multiple destination trips.
Averting Behavior Methods
Averting behavior methods observe what individuals do to protect themselves against environmental and other health risks, and they use information about these behaviors to infer individuals' values for reducing risks. Examples of RTI's experience in conducting averting behavior studies include analyses of
- Parents' values for protecting their children's health from air pollution
- Coping behaviors and costs associated with unreliable public water supplies.
Cost of Illness Methods
Cost of illness methods are used to assess the value of avoiding specific illnesses by estimating both the direct costs (e.g., medical costs) and indirect costs (e.g., lost earnings) associated with illness. Examples of RTI's experience with these methods include cost-of-illness studies for
- Environmentally related illness in older Americans
- Asthma symptoms
- Diarrheal disease and malaria in developing countries
- Developmental disabilities.
Benefit Transfer Methods
Benefit transfer methods use and adapt results from existing economic studies to estimate the benefits of specific policies. RTI analysts have applied benefit transfer methods to assess the benefits of a wide range of environmental policies, including
- Retrospective benefits of Clean Water Act (CWA) policies since 1972
- Health benefits from mercury emissions reductions
- Water quality benefit from effluent controls on Concentrated Animal Feeding Operations (CAFOs)
- Recreation and odor reduction benefits from swine waste management policies
Researchers at RTI have also been innovators in developing new benefit transfer methods, including the development of
- Benefit transfer functions for water quality improvements, based on a meta-analysis of water quality valuation studies
- Benefit transfer functions for avoided acute morbidity, based on a meta-analysis of health valuation studies
- Preference calibration and structural benefit transfer approaches designed to improve the internal theoretical validity of transfer methods.
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