Scandinavian Working Papers in Economics
Working Papers in Economics,
University of Gothenburg, Department of Economics
No 746: Which type of policy instrument do citizens and experts prefer? A choice experiment on Swedish marine and water policy
Claes Ek (), Katarina Elofsson and Carl-Johan Lagerkvist
Additional contact information
Claes Ek: Department of Economics, School of Business, Economics and Law, Göteborg University, Postal: P.O. Box 640, SE 40530 GÖTEBORG, Sweden
Abstract: In the choice between alternative environmental policy instruments, economists tend to favor policies capable of attaining cost-efficiency, but other considerations may be important to stakeholders. We perform a choice experiment modeled on Swedish water and marine policy to estimate preferences for different types of environmental policy instruments among citizens and municipal experts. To approximate preferences for each instrument per se, choice sets include several attributes that respondents may otherwise view as correlated with instrument type, such as how costs are shared between taxpayers and farmers. In our mixed-logit regressions, both the modal citizen and the modal expert prefer direct regulation and subsidies to nutrient trading. Experts weight taxpayer costs less heavily, implying larger WTP estimates; in particular, nutrient trading is unlikely to deliver sufficiently large cost savings for experts to prefer it to other instrument types. This potentially explains the low takeup of water quality trading outside the US.
Keywords: choice experiments; instrument choice; nutrient trading; water policy
37 pages, November 2018
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