Valuation of cancer and microbial disease risk reductions in municipal drinking water: An analysis of risk context using multiple valuation methods

We examine the value of health risk reductions (microbial illnesses/deaths and bladder cancer illnesses/deaths) in the context of drinking water quality treatment by public systems. When we assume that combined mortality and morbidity risk reductions are equally spread in the future; our results suggest that microbial risk-reduction programs have higher value than cancer risk-reduction programs, but that mortality risk reduction values are not significantly different for cancer and microbials. However, when a 25-year cancer latency is accounted for and a 5% discount rate is used, the value of cancer mortality risk reductions exceeds the value for microbial risk reductions. We also address a number of methodological issues, including performance of alternative choice experiment estimation (CE) techniques, relationship of CE to contingent valuation results, and implications for incorporating morbidity and mortality endpoints in the same survey instrument.

[1]  J. Deshazo,et al.  Advances in Evaluating the Demand for Risk Prevention Policies , 2005 .

[2]  J. Graham.  The Evolving Regulatory Role of the U.S. Office of Management and Budget , 2007, Review of Environmental Economics and Policy.

[3]  P. Zarembka.  Frontiers in econometrics , 1973 .

[4]  J. Swait,et al.  The Influence of Task Complexity on Consumer Choice: A Latent Class Model of Decision Strategy Switching , 2001 .

[5]  J. Louviere,et al.  Stated Preference Approaches for Measuring Passive Use Values: Choice Experiments and Contingent Valuation , 1998 .

[6]  Joseph E. Aldy,et al.  The Value of a Statistical Life: A Critical Review of Market Estimates Throughout the World , 2003 .

[7]  W. Adamowicz,et al.  Serial Nonparticipation in Repeated Discrete Choice Models , 2005 .

[8]  Ron Goeree,et al.  Age, Health and the Willingness to Pay for Mortality Risk Reductions: A Contingent Valuation Survey of Ontario Residents , 2002 .

[9]  Jon Strand,et al.  Public- and private-good values of statistical lives Results from a combined choice-experiment and contingent-valuation survey , 2001 .

[10]  James K. Hammitt,et al.  Effects of Disease Type and Latency on the Value of Mortality Risk , 2003 .

[11]  Anna Alberini,et al.  Willingness to pay for mortality risk reductions: Does latency matter? , 2004 .

[12]  J. Deshazo,et al.  Demand for environmental policies to improve health: Evaluating community-level policy scenarios , 2009 .

[13]  Robert Cameron Mitchell,et al.  Using Surveys to Value Public Goods: The Contingent Valuation Method , 1989 .

[14]  Daniel Kahneman,et al.  Valuing public goods: The purchase of moral satisfaction , 1992 .

[15]  I. Krinsky,et al.  On Approximating the Statistical Properties of Elasticities , 1986 .

[16]  R. Scarpa,et al.  Destination Choice Models for Rock Climbing in the Northeastern Alps: A Latent-Class Approach Based on Intensity of Preferences , 2005, Land Economics.

[17]  Kenneth Train,et al.  Discrete Choice Models in Preference Space and Willingness-to Pay Space , 2005 .

[18]  M. Hammerton,et al.  THE VALUE OF SAFETY: RESULTS OF A NATIONAL SAMPLE SURVEY. IN: URBAN TRANSPORT , 1985 .

[19]  N. Hanley,et al.  Choice modelling approaches: a superior alternative for environmental valuation? , 2002 .

[20]  P. Boxall,et al.  Understanding Heterogeneous Preferences in Random Utility Models: A Latent Class Approach , 2002 .

[21]  D. McFadden.  Conditional logit analysis of qualitative choice behavior , 1972 .

[22]  J. Hammitt.  Risk perceptions and food choice: an exploratory analysis of organic- versus conventional-produce buyers. , 1990, Risk analysis : an official publication of the Society for Risk Analysis.

[23]  Trudy Ann Cameron,et al.  A New Paradigm for Valuing Non-market Goods Using Referendum Data: Maximum Likelihood Estimation by Censored Logistic Regression' , 1988 .

[24]  P. Corso,et al.  Valuing Mortality-Risk Reduction: Using Visual Aids to Improve the Validity of Contingent Valuation , 2001 .

[25]  D. Hensher,et al.  Stated Choice Methods: Analysis and Applications , 2000 .

[26]  Thomas P. Holmes,et al.  Attribute-Based Methods , 2003 .

[27]  J. Reif,et al.  Workshop report. Health risks of drinking water chlorination by-products: report of an expert working group. , 1998, Chronic diseases in Canada.

[28]  K. Train.  Discrete Choice Methods with Simulation , 2003 .

[29]  J. Roosen,et al.  Scope insensitivity in health risk reduction studies: A comparison of choice experiments and the contingent valuation method for valuing safer food , 2007 .

[30]  W Slob,et al.  Balancing the risks and benefits of drinking water disinfection: disability adjusted life-years on the scale. , 2000, Environmental health perspectives.

[31]  Erik Meijer,et al.  Measuring Welfare Effects in Models with Random Coefficients , 2000 .

[32]  Pierre Payment,et al.  Evaluating the Risk of Infection from the Presence of Giardia and Cryptosporidium in Drinking Water , 2000 .

[33]  W. King,et al.  Case-control study of bladder cancer and chlorination by-products in treated water (Ontario, Canada) , 1996, Cancer Causes & Control.