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Chapter 3 Valuing Public Goods in a Risky World: An Experiment**I would like to thank the participants in a seminar at the University of Stockholm and two referees for their helpful and stimulating comments on an earlier version of this paper.

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DOI: 10.1016/s0166-1116(08)70026-8
Disciplines
  • Economics

Abstract

Publisher Summary This chapter presents preliminary results from an attempt to estimate willingness to pay measures for public goods in a risky world. Most of the results are consistent with the predictions generated by economic theory. For example, the willingness to pay is increasing in the number of saved species, which is the “public good” under consideration. According to the data, there is an interesting difference in risk attitudes between male and female respondents. The data set suggests that female respondents have risk aversion with respect to the considered public good. Male respondents, on the other hand, seem to have risk aversion only if many species become extinct while they are more inclined to accept risky outcomes if just a few species are threatened. There is also the possibility that respondents are unable to calculate ex ante compensating variation measures and therefore report some other money measure when the situation involves uncertain outcomes.

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