nep-res New Economics Papers
on Resource Economics
Issue of 2005‒01‒02
five papers chosen by
Maximo Rossi
Universidad de la República

  1. Willingness to Pay among Swedish Households to Avoid Power Outages - A Random Parameter Tobit Model Approach By Carlsson, Fredrik; Martinsson, Peter
  2. Does it Matter When a Power Outage Occurs? - A Choice Experiment Study on the Willingness to Pay to Avoid Power Outages By Carlsson, Fredrik; Martinsson, Peter
  3. Conservation of wildlife. A bio-economic model of a wildlife reserve under the pressure of habitat destruction and harvesting outside the reserve. By Anders Skonhoft; Claire Armstrong
  4. Tourism, Poaching and Wildlife Conservation: What can Integrated Conservation and Development Projects accomplish? By Anders Skonhoft; Anne Borge Johannesen
  5. Enhancing Efficiency of Water Supply – Product Market Competition versus Trade By Reto Foellmi; Urs Meister

  1. By: Carlsson, Fredrik (Department of Economics, School of Economics and Commercial Law, Göteborg University); Martinsson, Peter (Department of Economics, School of Economics and Commercial Law, Göteborg University)
    Abstract: Using a contingent valuation survey, we elicit Swedish households’ willingness to pay (WTP) to avoid power outages. In the study respondents are asked to state their WTP for avoiding nine different types of outages. We therefore apply a random parameter Tobit model since there is cross-sectional heterogeneity and a proportion of zero responses. Based on the estimations, we find that the WTP depends positively on the duration of the outages, and that WTP is significantly higher for unplanned outages. The overall variation in the WTP due to observed heterogeneity in housing and socio-economic variables is small compared to the pure effects of power outages. Policy implications of those findings are discussed. <p>
    Keywords: Power outages; Contingent Valuation; Random parameters; Tobit model
    JEL: C25 C93 D12 Q41
    Date: 2004–12–20
  2. By: Carlsson, Fredrik (Department of Economics, School of Economics and Commercial Law, Göteborg University); Martinsson, Peter (Department of Economics, School of Economics and Commercial Law, Göteborg University)
    Abstract: Using a choice experiment survey, the marginal willingness to pay (WTP) among Swedish households for reductions in power outages is estimated. The results from the random parameter logit estimation indicate that the marginal WTP increases with the duration of the outages, and is higher if the outages occur during weekends and during winter months. The random parameter logit model allows us to estimate a sample distribution of WTP. We find a significant unobserved heterogeneity in some of the outage attributes but not all. Furthermore we show that the sample distribution of WTP does not to any large extent suffer from the problem of reverse sign of the WTP. Therefore, choosing an unconstrained normal distribution might not be as problematic as one would think. Given that households have negative welfare effects from outages, which differ in timing and duration, and are rarely compensated for them, it is important that policy makers consider these negative impacts on households utility when regulating the electricity market. <p>
    Keywords: Choice experiment; Power outages; Random parameters; Willingness to pay
    JEL: C25 C93 D12 Q41
    Date: 2004–12–20
  3. By: Anders Skonhoft (Department of Economics, Norwegian University of Science and Technology); Claire Armstrong (Norwegian College of Fishery Science, University of Tromsø)
    Abstract: Biodiversity is today threatened by many factors of which destruction and reduction of habitats are considered most important for terrestrial species. One way to counteract these threats is to establish reserves with restrictions on land-use and exploitation. However, very few reserves can be considered islands, wildlife species roam over large expanses, often via some density dependent dispersal process. As a consequence, habitat destruction, and exploitation, taking place outside will influence the species abundance inside the conservation area. The paper presents a theoretical model for analysing this type of management problem. The model presented allows for both the common symmetric dispersal as well as what is called asymmetric dispersal between reserve and outside area. The main finding is that habitat destruction outside may not necessarily have negative impact upon the species abundance in the reserve. As a consequence, economic forces working in the direction of reducing the surrounding habitat have unclear effects on the species abundance within the protected area. We also find that harvesting outside the reserve may have quite modest effect on the species abundance in the reserve. This underlines the attractiveness of reserves from a conservation viewpoint.
    Date: 2004–01–15
  4. By: Anders Skonhoft (Department of Economics, Norwegian University of Science and Technology); Anne Borge Johannesen (Department of Economics, Norwegian University of Science and Technology)
    Abstract: Integrated Conservation and Development Projects (ICDPs) have frequently been established in Africa to improve wildlife conservation and the welfare of local communities. However, their effectiveness so far has been hampered by conflicts and illegal harvesting activities. Within a Gordon-Schäfer-type model, this paper focuses on the strategic interaction between the manager of a protected area and a group of local people living near the park. The park manager benefits from wildlife through non-consumptive tourism and safari hunting. The local people benefit through hunting, although this is illegal according to existing laws, but they also bear costs as wildlife causes agricultural damage. Depending on the economic and ecological environment, we show that ICDPs relying on money transfers to the local people derived from the park manager’s activities may or may not promote wildlife conservation. In addition, we demonstrate that the effects on the welfare of the local people are ambiguous.
    Keywords: wildlife, conservation, conflicts, local welfare
    JEL: Q2 Q20
    Date: 2004–08–15
  5. By: Reto Foellmi (Massachusetts Institute of Technology); Urs Meister (University of Zurich)
    Abstract: This paper analyses and compares potential efficiency gains induced by the introduction of product market competition and cross boarder trade in the piped water market. We argue that due to the specific circumstances in the water sector product market competition, i.e. competition by common carriage is not expected to be very intensive. The connection of networks could alternatively be used for cross boarder trade between neighboured water utilities. We show that competition by common carriage leads to production incentives for the inefficient supplier. This implies that the retail prices tend to be lower than with cross border trade. However, the efficiency effect dominates and resulting welfare is higher in case of trade.
    Keywords: Water, Networks, Product-Market Competition, Trade, Bargaining
    JEL: L95 L43 D21 Q25
    Date: 2004–12–21

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