Ecological Economics 32 2000 269 – 286
ANALYSIS
A test of policy labels in environmental choice modelling studies
R.K. Blamey
a,
, J.W. Bennett
b
, J.J. Louviere
c
, M.D. Morrison
d
, J. Rolfe
e
a
Urban and En6ironmental Program, Research School of Social Sciences, Australian National Uni6ersity, ACT
0200
, Australia
b
Economics and Management, Uni6ersity of NSW, Canberra, ACT, Australia
c
Department of Marketing, Sydney Uni6ersity, Sydney, NSW, Australia
d
Charles Sturt Uni6ersity, Bathurst, NSW, Australia
e
Central Queensland Uni6ersity, Emerald, Qld, Australia Received 22 February 1999; received in revised form 27 July 1999; accepted 28 July 1999
Abstract
A question that arises in the application of environmental choice modelling CM studies is whether to present the choice sets in a generic or labelled form. The former involves labelling the policy options to be presented to
respondents in a generic way, for example, as ‘option A’, ‘option B’, etc. The labelled approach assigns alternative- specific descriptors to each option. These may relate to the names of proposed policies, different locations or any
other policy-relevant details. Both approaches have their advantages. A potential advantage of using alternative-spe- cific labels is that respondents may be better able to base their choices on the true policy context. This can increase
predictive validity whilst at the same time reducing the cognitive burden of the CM exercise. A potential advantage of the generic labelling approach is that respondents may be less inclined to base their choices wholly or largely on
the labels, and as a consequence, may provide better information regarding trade-offs among attributes. The two approaches to choice set design are compared in the context of a CM study of the values of remnant vegetation in
the Desert Uplands of Central Queensland. Results indicate a difference in the cognitive processes generated by choice models using the different approaches. This difference is reflected in both the alternative-specific constants and the
taste parameters, and cannot be accounted for by differences in error variance across the two treatments. The implications for environmental valuation are discussed. © 2000 Elsevier Science B.V. All rights reserved.
Keywords
:
Choice modelling; Stated preferences; Non-market valuation www.elsevier.comlocateecolecon
1. Introduction
Recent years have seen increasing interest in the use of conjoint-based stated preference methods
for the assessment of environmental values. Al- though the contingent valuation method CVM
remains the most commonly applied stated prefer-
Corresponding author. Fax: + 61-2-62490312. E-mail
address
:
rblameycoombs.anu.edu.au R.K.
Blamey 0921-800900 - see front matter © 2000 Elsevier Science B.V. All rights reserved.
PII: S 0 9 2 1 - 8 0 0 9 9 9 0 0 1 0 1 - 9
ence technique in this area, techniques such as choice modelling CM, also referred to as the
choice experiment,
are increasingly
being favoured.
Whilst applications of the discrete choice CVM require respondents to choose between a base
option and a single alternative, respondents to CM exercises are typically presented with six to
ten choice sets, each containing a base option and two or three alternatives. They are required to
indicate which option they prefer in each choice set. The levels of the attributes characterising the
different choice set options are varied according to an experimental design, permitting estimates of
the relative importance of the attributes describ- ing the options to be obtained. Rather ‘than being
questioned about a single event in detail, as in CVM analysis, subjects are questioned about a
sample of events drawn from the universe of possible events of that type’ Boxall et al., 1996, p.
244.
A fundamental question that arises in the appli- cation of CM is whether to present the choice sets
in a generic or labelled form. The generic form involves assigning generic labels to each alterna-
tive in the choice set, such as ‘alternative A’, ‘alternative B’ etc. The labelled form involves
assigning labels that communicate, directly or in- directly, information regarding the tangible and
or intangible qualities of the alternatives. In marketing applications, labels tend to consist of
brand names and logos, which consumers have learnt to associate with different product charac-
teristics and feelings. In the context of environ- mental policy, labels tend to refer to sites,
locations, policy names or other descriptors.
An advantage of assigning issue-relevant and alternative-specific labels is that responses will
better reflect the emotional context in which pref- erences are ultimately revealed. For example, a
respondent may have a predisposition toward vis- iting a particular recreation site because he or she
has fond memories from a past visit. This factor may not be reflected in the results of a CM
exercise that describes sites purely in terms of tangible attributes involving recreation opportuni-
ties, camping facilities, proximity and cost. Often, the most plausible way of including such informa-
tion is in the form of a label. This information not only increases predictive validity, but may also
make the exercise less cognitively demanding.
Offsetting this potential advantage of labelled choice set configurations is the likelihood that
generic configurations may encourage more dis- cerning and discriminating responses. Instead of
respondents being able to base their responses wholly or largely on the alternative with the most
superficially attractive label or descriptor, respon- dents are required to consider differences in policy
options as described by the attributes listed in the choice sets Blamey et al., 1997; Morrison et al.,
1997. The resultant more informed and deliber- ated preferences may be desirable from a non-
market
valuation perspective
Mitchell and
Carson, 1989. In this paper, the effects of employing labelled
rather than generic choice-set configurations are considered. A split sample approach is used. Two
statistically equivalent samples of the Brisbane population were presented with the same basic
CM questionnaire, with the exception that one employed a generic approach and the other a
labelled approach. This enables a direct compari- son of the two sets of results with a view to
assessing the degree of convergent validity. These issues are considered in the context of a CM study
of remnant vegetation values in the Desert Up- lands of Central Queensland, Australia.
The paper is structured as follows. The theoret- ical basis of CM is briefly reviewed in Sections 2
and 3, and the case study is introduced in Section 4. Methods are then presented in Sections 5 – 7,
and the results are presented in Section 8. Some conclusions are finally drawn.
2. Theoretical basis of choice modelling
