The effects of current and expected future income on stated preferences for environmental improvements

TY - JOUR

T1 - The effects of current and expected future income on stated preferences for environmental improvements

AU - Jacobsen, Jette Bredahl

AU - Lundhede, Thomas

AU - Thorsen, Bo Jellesmark

PY - 2013/4

Y1 - 2013/4

N2 - We formulate and test the hypothesis that expectations regarding changes in future income influences the WTP for environmental goods. For valuation of environmental goods in forests and other habitats in Denmark, we find that both current income and expected changes in future income are significant determinants for preferences. The effect of income on WTP seems to be caused by changes in preferences for environmental attributes rather than by marginal utility of income. The results suggest that to evaluate the distributional impacts of environmental improvements, researchers need a better measure of expected future consumption options than current income.

AB - We formulate and test the hypothesis that expectations regarding changes in future income influences the WTP for environmental goods. For valuation of environmental goods in forests and other habitats in Denmark, we find that both current income and expected changes in future income are significant determinants for preferences. The effect of income on WTP seems to be caused by changes in preferences for environmental attributes rather than by marginal utility of income. The results suggest that to evaluate the distributional impacts of environmental improvements, researchers need a better measure of expected future consumption options than current income.

U2 - 10.1016/j.jfe.2013.02.002

DO - 10.1016/j.jfe.2013.02.002

M3 - Journal article

SN - 1104-6899

VL - 19

SP - 206

EP - 219

JO - Journal of Forest Economics

JF - Journal of Forest Economics

IS - 2

ER -