Investigating distance effects on environmental values: A choice modelling approach

This paper describes a Choice Modelling experiment set up to investigate the relationship between distance and willingness to pay for environmental quality changes. The issue is important for the estimation and transfer of benefits. So far the problem has been analysed through the use of Contingent Valuation-type of experiments, producing mixed results. The Choice Modelling experiment allows testing distance effects on parameters of environmental attributes that imply different trade-offs between use and non-use values. The sampling procedure is designed to provide a Ògeographically balancedÓ sample. Several specifications of the distance covariate are compared and distance effects are shown to take complex shapes. Welfare analysis also shows that disregarding distance produces under-estimation of individual and aggregated benefits and losses, seriously hindering the reliability of costbenefit analyses.