Contingent Valuation of Global Environmental Resources: Test of Perfect and Regular embedding

Examines the internal consistency of willingness to pay (WTP) assessed for 4 environmental amenities (preservation of 50,000 hectares of rain forests in Bolivia, saving of the African elephant, an improvement of the air-quality in living area, and a 20% reduction of the gases that give rise to global warming) in a hypothetical market scenario. Particularly, the occurrence of embedding is investigated by performing external tests of part-whole effects and insensitivity to scope. Moreover, 4 different measures or intensifiers of scope are applied in order to evaluate their influence on scope sensitivity. The responsiveness of WTP is also compared with categorical rating (CR) as an alternative measure of environmental priorities. Results (based on 427 respondents) indicate that neither instrument, as utilised here, is capable of making the respondents responsive to scope. The weak relation between expressed economic value and instrumental considerations are also supported by small variations in mean WTP across the 4 issues. A part-whole effect is finally demonstrated for global warming, where respondents are willing to pay more when global warming is valued on its own that respondents who consider this amenity in conjunction with 3 other environmental issues.