Loureiro, M.L., Gracia, A., Nayga, Jr, R.N. (2013) “Do Experimental Auction Estimates Pass the Scope Test?”  Journal of Economic Psychology, 37(2013), 7-17.

Abstract

Scope insensitivity is a popular anomaly in many valuation studies. Although scope insensitivity is a problem that may be present in any valuation method, most previous literature has focused on evaluating scope sensitivity within the context of contingent valuation applications. Nevertheless, it is necessary to understand the demand-revealing properties of experimental auctions since they are increasingly used to value products, such as quasi-public goods. In this paper, we test explicitly whether estimates coming from experimental auctions may pass a scope test. We conduct experimental auctions on products with a subset of attributes (part) and a comprehensive set of attributes (whole) related to animal welfare using two multi-product auction approaches: sequential and simultaneous. Results show that estimates pass the scope test when multi-product auctions are conducted simultaneously but not when they are conducted sequentially for all valued products. Implications of these findings are discussed.

Alló, Maria, Loureiro, M.L. (2013) “Estimating a Meta-damage Regression Model for Large Accidental Oil Spills” Ecological Economics, 86, 167-175.

Abstract

Oil spills cause major damage to both a wide range of economic sectors and the environment. It is therefore important to anticipate the potential damage caused by these types of disasters, which can occur under many different and unpredictable circumstances. In this paper we study the main determining factors of the damage caused by oil spills, focusing in particular on the role played by the legislation applied in preventing these accidents. We find that more restrictive legislation reduces the economic damage caused by vessel oil spills. Based on the results of this international meta-regression, we are able to predict the marginal contributions to the damage function of the most relevant causing factors. These estimated damages can be used for rapid evaluations in the future, in cases where a direct damage assessment is not possible.

Barrio, M., Loureiro, M.L. (2013) “The Impact of Protest Responses in Choice Experiments: An Application to a Biosphere Reserve Management Program”
Forest Systems, 22(1): 94-105.

Abstract

Aim of study: To identify protest responses and compute welfare estimates with and without the inclusion of such responses using follow-up statements in a choice experiment exercise. To our knowledge, this is one of the first empirical applications that, following the conventional treatment used in contingent valuation methodology, explicitly deals with the treatment and identification of protest responses in choice experiments.

Area of study: the Eo, Oscos y Terras de Burón Biosphere Reserve sited between the regions of Galicia and Asturias. We are interested in the influence of such responses on preference elicitation for alternative management actions in this Reserve.

Materials and methods: A face-to-face survey conducted in a sample of residents and non-residents of this Reserve. In total, more than 450 surveys were collected.

Main results show that protest responses are fairly common in choice experiments, and their analysis affects the statistical performance of the empirical models as well as the valuation estimates. In fact, when the sample is corrected by protest responses, its size decreases to 303 individuals. Furthermore, we can observe that protest responses are triggered by a less positive attitude towards the wolf.

Research highlight: Protest responses are a common issue in choice experiments and, therefore, future exercises should consider them explicitly, as earlier contingent valuation studies have.

Loureiro, M.L, Yen, S., Nayga, R. (2012) “The effects of Nutritional Labels on Obesity” Agricultural Economics, 43(3), 333-342.

Abstract

This study examines the relationship between nutritional label use and obesity using switching regression. Results for treatment effect show that nutritional labels play a role in reducing obesity among users of nutritional labels, notably among women. The average body mass index (BMI) for men who read nutritional labels is 0.12 point lower than men who do not read them, while women who are users of nutritional labels have 1.49 points lower BMI than women who do not read labels. These findings imply that health education campaigns can employ nutritional labels as one of the instruments for reducing obesity.