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2023
- handle: 10670/1.x20pcw
- hal: hal-03620225
- doi: 10.1080/09640568.2021.2008884
- WOS: 000764932200001
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info:eu-repo/semantics/altIdentifier/doi/10.1080/09640568.2021.2008884
info:eu-repo/semantics/OpenAccess
Mots-clés
subsistence needs adjustment factor non-market valuation value transfer population’s preferences ACL-3 / HCERES BSujets proches
Standard of value Capitalization (Finance) Appraisal Property--Valuation Economic valuationCiter ce document
Victor Champonnois et al., « Accounting for subsistence needs in non-market valuation: a simple proposal », HAL-SHS : économie et finance, ID : 10.1080/09640568.2021.2008884
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Résumé
Revealed and stated preference techniques are widely used to assess willingness to pay (WTP) for non-market goods as input to public and private decision-making. However, individuals first have to satisfy subsistence needs through market good consumption, which affects their ability to pay. We provide a methodological framework and derive a simple ex post adjustment factor to account for this effect. We quantify its impacts on the WTP for non-market goods and the ranking of projects theoretically, numerically and empirically. This confirms that non-adjusted WTP tends to be plutocratic: the views of the richest – whatever they are – are more likely to impact decision-making, potentially leading to ranking reversal between projects. We also suggest that the subsistence needs-based adjustment factor we propose has a role to play in value transfer procedures. The overall goal is a better representation of the entire population’s preferences with regard to non-market goods.