Now showing 1 - 4 of 4
  • Publication
    Valuing the environment using the life-satisfaction approach
    (University College Dublin. School of Geography, Planning and Environmental Policy, 2006-05) ; ;
    This paper presents a comprehensive theoretical and methodological framework clarifying the relationship between non-market environmental valuation techniques, in particular hedonic and life-satisfaction methods. The paper shows how life satisfaction scores can be used to test correctly the equilibrium condition in location markets required by the hedonic approach and that in the absence of equilibrium, the life-satisfaction approach is still a theoretically valid valuation technique. Valuation using the life-satisfaction approach suffers from caveats associated with the cardinalisation of utility, however. Using data from Ireland, we apply this framework to the valuation of amenities linked to respondents’ dwelling areas using Geographic Information Systems (GIS).
      992
  • Publication
    Quality of life and location-specific amenities : a subjective well-being approach
    (University College Dublin. Department of Planning and Environmental Policy, 2005-07) ; ;
    In recent years, economists have started using socio-economic and socio-demographic characteristics to explain self-reported individual happiness or satisfaction with life. Using data disaggregated at the individual and regional level, this paper shows that while these variables are relevant, consideration of amenities such as climate, environmental and urban conditions, typically employed in hedonic wage and housing regressions, is critical when analysing subjective well-being. Location-specific factors are shown to have a direct impact on life satisfaction, suggesting that their effect on quality of life is not fully captured by compensating differentials in housing and labour markets.
      369
  • Publication
    Environmental amenities and subjective well-being : testing the validity of hedonic pricing
    (University College Dublin. Planning and Environmental Policy, 2006-06) ; ;
    This paper proposes a subjective well-being approach to test the equilibrium condition implicit in hedonic pricing. Contrary to the conclusions of previous studies, we show that both approaches are not complementary but, rather, they are alternative ways of computing implicit prices of environmental amenities. They are equivalent when the equilibrium condition holds but, in the absence of such equilibrium, only the subjective well-being approach is theoretically correct. In an empirical application, we find that (i) the total impact of location-specific amenities on self-reported well-being is not fully captured through compensating differentials in labor and housing markets, indicating that implicit prices derived using the hedonic approach would be incorrect and thus suggesting caution in its application, and (ii) environmental factors are as important as the most critical socio-economic and socio-demographic factors in explaining subjective well-being.
      479
  • Publication
    A spatial econometric analysis of well-being using a geographical information systems approach
    (University College Dublin. Planning and Enviornmental Policy, 2006-07) ; ;
    In recent years, economists have being using socio-economic and socio-demographic characteristics to explain self-reported individual happiness or satisfaction with life. Using Geographical Information Systems (GIS), we employ data disaggregated at the individual and local level to show that while these variables are important, consideration of amenities such as climate, environmental and urban conditions is critical when analyzing subjective wellbeing. Location-specific factors are shown to have a direct impact on life satisfaction. Most importantly, however, the explanatory power of our happiness function substantially increases when the spatial variables are included, highlighting the importance of the role of the spatial dimension in determining well-being. This may have potentially important implications for setting priorities for public policy as, in essence, improving well-being could be considered to be the ultimate goal of public policy.
      868