Estimation of Spatially Explicit Water Quality Benefits throughout River Systems: Development of Next Generation Stated Preference Methods

Stated Preference (SP) methods are survey-based methods to calculate the economic value of environmental improvements, and provide the only means to measure total use and nonuse willingness to pay (WTP) for water quality change. Yet water quality has multiple characteristics that pose challenges for WTP estimation: water quality can vary spatially and temporally, the role of small streams is often under-appreciated, and water quality benefits are often realized through direct and indirect effects on other ecosystem services valued by different user and nonuser groups who may use and interpret indicators differently. Current methods are often stretched to their limits when faced with the heterogeneous and temporally/spatially explicit ways that aquatic ecosystem changes affect different user and nonuser groups. This large, multi-year interdisciplinary project will develop and evaluate a next generation approach to SP valuation, Free-form Choice Experiments (FCEs). FCEs restructure the way that WTP is elicited and estimated, hybridizing traditional survey methods with online labor pool survey techniques and Bayesian econometrics. The approach is developed to estimate use and nonuse WTP for linked water quality and ecosystem service improvements across river networks, but easily extends to other applications. The project intends to revolutionize the methods used by government agencies and others to calculate the benefit of water quality improvements to society. The project is led by Marsh Institute director Robert Johnston, with collaborators from the University of New Hampshire, Virginia Tech, and Abt Associates.