- Open access
- Published:
Spatial effects in willingness to pay for avoiding nuclear risks
Swiss Journal of Economics and Statistics volume 149, pages 357–379 (2013)
Summary
How to deal with the risks associated with nuclear energy is a major policy issue. This paper investigates the effect of an individual’s distance from nuclear power plants on willingness to pay for increased insurance coverage against nuclear accidents (MWP C ) as well as on willingness to pay for solving the nuclear waste disposal problem (MWP W ). Using data from a discrete choice experiment conducted in Switzerland, we find evidence that MWP C values decrease with distance from plant once attitudes influencing choice of residential location are controlled for. However, distance from plant has no effect on MWP W values.
References
Bishop, Richard C., and Thomas A. Heberlein (1979), “Measuring Values of Extramarket Goods: Are Indirect Measures Biased?”, American Journal of Agricultural Economics, 61(5), pp. 926–930.
Clark, David E., and Tim Allison (1999), “Spent Nuclear Fuel and Residential Property Values: The Influence of Proximity, Visual Cues and Public Information”, Papers in Regional Science, 78(4), pp. 403–421.
Davis, Lucas W. (2004), “The Effect of Health Risk on Housing Values: Evidence from a Cancer Cluster”, American Economic Review, 94(5), pp. 1693–1704.
de Bekker-Grob, Esther W, Mandy Ryan, and Karen Gerard (2010), “Discrete Choice Experiments in Health Economics: A Review of the Literature”, Health Economics, 21(2), pp. 145–172.
Diamond, Peter A., and Jerry A. Hausman (1994), “Contingent Valuation: Is Some Number Better than No Number?”, The Journal of Economic Perspectives, 8(4), pp. 45–64.
Dionne, Georges, and Louis Eeckhoudt (1985), “Self-Insurance, Self-Protection and Increased Risk Aversion”, Economics Letters, 17(1–2), pp. 39–42.
Ehrlich, Isaac, and Gary S. Becker (1972), “Market Insurance, Self-Insurance, and Self-Protection”, The Journal of Political Economy, 80(4), pp. 623–648.
Farber, Stephen (1998), “Undesirable Facilities and Property Values: A Summary of Empirical Studies”, Ecological Economics, 24(1), pp. 1–14.
Folland, Sherman, and Robbin Hough (2000), “Externalities of Nuclear Power Plants: Further Evidence”, Journal of Regional Science, 40(4), pp. 735–753.
Gamble, Hays B., and Roger H. Downing (1982), “Effects of Nuclear Power Plants on Residential Property Values”, Journal of Regional Science, 22(4), pp. 457–478.
Gawande, Kishore, and Hank Jenkins-Smith (2001), “Nuclear Waste Transport and Residential Property Values: Estimating the Effects of Perceived Risks”, Journal of Environmental Economics and Management, 42(2), pp. 207–233.
Gyrd-Hansen, Dorte, and Ulla Slothuus (2002), “The Citizen’s Preferences for Financing Public Health Care: A Danish Survey”, International Journal of Health Care Finance and Economics, 2(1), pp. 25–36.
Hanemann, W. Michael (1984), “Welfare Evaluations in Contingent Valuation Experiments with Discrete Responses”, American Journal of Agricultural Economics, 66(3), pp. 332–341.
Hardin, R. H., and N. J. A. Sloane (1991–2003), GOSSET: A General-Purpose Program for Designing Experiments, www.research.att.com/ñjas/gosset/.
Hartog, Joop, Ada Ferrer-i Carbonell, and Nicole Jonker (2002), “Linking Measured Risk Aversion to Individual Characteristics”, Kyklos, 55(1), pp. 3–26.
Ida, Takanori, and Toshifumi Kuroda (2006), “Discrete Choice Analysis of Demand for Broadband in Japan”, Journal of Regulatory Economics, 29(1), pp. 5–22.
Kelly, Mary, and Anne E. Kleffner (2003), “Optimal Loss Mitigation and Contract Design”, The Journal of Risk and Insurance, 70(1), pp. 53–72.
Louviere, Jordan, David Hensher, and Joffre Swait (2000), Stated Choice Methods— Analysis and Applications, Cambridge University Press.
Louviere, Jordan J., David Pihlens, and Richard Carson (2010), “Design of discrete choice experiments: A discussion of issues that matter in future applied research”, Journal of Choice Modelling, 4(1), pp. 1–8.
Nelson, Jon (1981), “Three Mile Island and Residential Property Values: Empirical Analysis and Policy Implications”, Land Economics, 57(3), pp. 363–372.
Nielsen, Jesper B., Dorte Gyrd-Hansen, Ivar Sønbø Kristiansen, and Jørgen Nexøe (2003), “Impact of Socio-demographic Factors on Willingness to Pay for the Reduction of a Future Health Risk”, Journal of Environmental Planning and Management, 46(1), pp. 39–47.
Riddel, Mary, Christine Dwyer, and W. Douglass Shaw (2003), “Environmental Risk and Uncertainty: Insights from Yucca Mountain”, Journal of Regional Science, 43(3), pp. 435–457.
Schneider, Yves, and Peter Zweifel (2004), “How Much Internalization of Nuclear Risk Through Liability Insurance?”, Journal of Risk and Uncertainty, 29(3), pp. 219–240.
Smith, Kerry, and William H. Desvousges (1986), “The Value of Avoiding a LULU: Hazardous Waste Disposal Sites”, The Review of Economics and Statistics, 68(2), pp. 293–299.
Telser, Harry, and Peter Zweifel (2002), “Measuring Willingness-To-Pay For Risk Reduction: An Application of Conjoint Analysis”, Health Economics, 11(2), pp. 129–139.
Author information
Authors and Affiliations
Corresponding author
Additional information
We want to thank Michael Breuer, Patrick Eugster, Charles Holt, Harry Telser, Christian Wyss, participants at the ASTIN conference and at the annual meeting of the Swiss Society of Economics and Statistics, seminar participants at the Universities of Virginia and Zurich and at the Curtin Business School (Perth, Australia) for valuable comments. Financial support came from the Swiss Federal Office of Energy and the Swiss Institute of Technology Yves Schneider acknowledges financial support by the Swiss National Science Foundation via grant PBZH1-117037. Any errors and omissions are ours.
Rights and permissions
Open Access This article is distributed under the terms of the Creative Commons Attribution 2.0 International License ( https://creativecommons.org/licenses/by/2.0 ), which permits unrestricted use, distribution, and reproduction in any medium, provided the original work is properly cited.
About this article
Cite this article
Schneider, Y., Zweifel, P. Spatial effects in willingness to pay for avoiding nuclear risks. Swiss J Economics Statistics 149, 357–379 (2013). https://doi.org/10.1007/BF03399395
Published:
Issue Date:
DOI: https://doi.org/10.1007/BF03399395