Ta. Cameron et J. Englin, WELFARE EFFECTS OF CHANGES IN ENVIRONMENTAL-QUALITY UNDER INDIVIDUAL UNCERTAINTY ABOUT USE, The Rand journal of economics, 28, 1997, pp. 45-70
We adapt the theoretical state-preference model to value nonmarket pub
lic goods under individual uncertainty about use, illustrating with an
assessment of willingness-to-pay to prevent acid rain lake damage in
the northeast United States. Individual usage uncertainty is modelled
via probabilities of participation in trout fishing. Changes in enviro
nmental quality are valued using a random utility model to explain yes
/no responses to a contingent valuation question. We produce quantitat
ive welfare measures: individual fitted and simulated passive- and act
ive-use values, individual expected consumer surplus, option price, op
tion value, and complete individual willingness-to-pay loci.