Joseph C. Cooper

One-and-One-Half Bound Dichotomous Choice Contingent Valuation

Although the double-bound (DB) format for the discrete choice contingent valuation method (CVM) has the benefit of higher efficiency in welfare benefit estimates than the single-bound (SB) discrete choice CVM, it has been subject to criticism due to evidence that some of the responses to the second bid may be inconsistent with the responses to the first bid. As a means to reduce the potential for response bias on the follow-up bid in multiple-bound discrete choice formats such as the DB model while maintaining much of the efficiency gains of the multiple-bound approach, we introduce the one-and-one-half-bound (OOHB) approach and present a real-world application. In a laboratory setting, despite the fact that the OOHB model uses less information than the DB approach, the efficiency gains in moving from SB to OOHB capture a large portion of the gain associated with moving from SB to DB. Utilizing distribution-free seminonparametric estimation techniques on a split-survey data set, our OOHB estimates demonstrated higher consistency with respect to the follow-up data than the DB estimates and were more efficient as well. Hence, OOHB may serve as a viable alternative to the DB format in situations where follow-up response bias may be a concern.

Incentive Payments to Encourage Farmer Adoption of Water Quality Protection Practices

Farmers can be encouraged to voluntarily adopt environmentally sound management practices through the use of incentive payments. This paper uses both a bivariate probit with sample selection model and a double hurdle model on data from a survey of farmers to predict farmer adoption of the practices as a function of the payment offer. The five management practices addressed here are integrated pest management, legume crediting, manure testing, split applications of nitrogen, and soil moisture testing. Also estimated are models that predict the acreage on which these practices would be applied given the decision to accept the incentive payments estimated. Copyright 1996, Oxford University Press.

The Effect of Rental Rates on the Extension of Conservation Reserve Program Contracts

Given that the majority of conservation reserve program (CRP) contracts on approximately 36 million acres of enrolled land expire concurrently, re-enrollment decisions by farmers and the federal government have high budgetary implications. Using a survey of over 8,000 CRP contract holders, we apply an ordered response discrete choice model to explicitly model the range in rental rates over which the representative farmer may be ambivalent to renewing the CRP contract. Given the empirical results from the ordered response model, we estimate acreage re-enrollment as a function of the rental rate and compare them to results of a binomial choice model.

Welfare Impacts of Alternative Biofuel and Energy Policies

We employ an open economy general equilibrium model to investigate the effects of government energy policy, with emphasis on corn-based ethanol, on the U.S. economy. The model specification incorporates world and domestic markets, assumes pollution costs from fuel consumption, and allows endogenous determination of equilibrium quantities and prices for oil, corn and ethanol. The model is calibrated to represent a recent benchmark data set for 2009 and is used to simulate the positive and normative effects of alternative policies. We find that a second best policy of a fuel tax and ethanol subsidy approximates fairly closely the welfare gains associated with the first best policy (optimal carbon tax and tariffs on traded goods).The largest economic gains to the U.S. economy from these energy policies arise from the impact of policies on the U.S.’s terms of trade, particularly in the oil market. We also find that, conditional on the current fuel tax, an optimal ethanol mandate is superior to an optimal ethanol subsidy. In the benchmark case the optimal mandate slightly exceeds 15 billion gallons of ethanol.

Economic benefit of the protection program for the Steller sea lion

This paper examines willingness to pay (WTP) for an endangered species across geographically nested samples using the Contingent Valuation Method (CVM). The three samples range from (1) the boroughs that contain critical habitat for the Steller sea lion to (2) the state that contains these boroughs to and (3) the entire United States. Depending on the assumptions of the model, WTP varies tremendously from sample to sample. WTP for the United States is the highest and it is the lowest for the boroughs. The null hypotheses that mean WTP estimates are greater then zero were rejected for the boroughs and the state but were not rejected for the United States based on the 95% confidence intervals.

Farmer Premiums for the Voluntary Adoption of Conservation Plans

Programs that reimburse farmers for the cost of implementing more environmentally benign management practices are becoming increasingly popular in both the US and the EU. Utilizing the random utility and random profit difference approaches, the paper develops a theoretical model that explains why farmers may require a premium in excess of the decrease in profits to adopt a conservation plan, and may even require a premium in the case where adoption of the plan is associated with a mean increase in profits. This premium is estimated using a survey of farmers in conjunction with predictions of changes in production costs.

Testing whether waterfowl hunting benefits increase with greater water deliveries to wetlands

The change in waterfowl hunting benefits due to an increase in water deliveries to the levels required for biologically optimal wildlife refuge management at Californias San Joaquin Valley National Wildlife Refuges are estimated with the Travel Cost Method, using both ordinary least squares and Poisson count data estimators. To test whether these increases were statistically significant, the Krinsky and Robb technique was used to find confidence intervals around the consumer surplus point estimates. The increases in consumer surplus were found to be statistically significant in 5 of the 6 refuges based on OLS regression estimates and in all 6 refuges using Poisson count data regression estimates. In addition, a comparison of the marginal value of an acre-foot of water in consumptive recreational use versus agriculture use is made, with the finding that the marginal value of water in waterfowl hunting was greater than the marginal value of water in agriculture for one of the six refuges.

Agricultural Biodiversity and Biotechnology in Economic Development

This volume summarizes the current state of knowledge in the economic literature of management of agricultural biotechnology and biodiversity in agricultural and economic development. It identifies key issues confronting policy makers in managing biodiversity and biotechnology and provides a broad, multi-disciplinary analysis of the linkage between the two. It is especially innovative in its use of plant genetic resource management as the basis for is analysis.

Economic Value of Wildlife Resources in the San Joaquin Valley: Hunting and Viewing Values

This chapter quantifies the effects of agricultural drainage on the recreational demand for wildlife resources in the San Joaquin Valley (Valley). The current value of waterfowl hunting is

Crop Insurance, Disaster Payments and Land Use Change: The Effect of Sodsaver on Incentives for Grassland Conversion

3.2 million annually at public refuges and