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Title:The life satisfaction approach to environmental valuation PDF Logo
Authors:Frey, Bruno S.
Luechinger, Simon
Stutzer, Alois
Issue Date:2009
Series/Report no.:IZA Discussion Papers 4478
Abstract:In many countries environmental policies and regulations are implemented to improve environmental quality and thus individuals' well-being. However, how do individuals value the environment? In this paper, we review the Life Satisfaction Approach (LSA) representing a new non-market valuation technique. The LSA builds on the recent development of subjective well-being research in economics and takes measures of reported life satisfaction as an empirical approximation to individual welfare. Micro-econometric life satisfaction functions are estimated taking into account environmental conditions along with income and other covariates. The estimated coefficients for the environmental good and income can then be used to calculate the implicit willingness-to-pay for the environmental good.
Subjects:Life satisfaction approach
subjective well-being
non-market valuation
cost-benefit analysis
air pollution
JEL:Q51
I31
D61
Q53
Persistent Identifier of the first edition:urn:nbn:de:101:1-20091019279
Document Type:Working Paper
Appears in Collections:IZA Discussion Papers, Forschungsinstitut zur Zukunft der Arbeit (IZA)

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