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ON THE DERIVATION OF INDIFFERENCE CURVES FOR ESTIMATING CONSUMER SURPLUS

ON THE DERIVATION OF INDIFFERENCE CURVES FOR ESTIMATING CONSUMER SURPLUS ON THE DERIVATION OF INDIFFERENCE CURVES FOR ESTIMATING CONSUMER SURPLUS J. 0. S. KENNEDY La Trobe University, Bundoora, Vic. 3083 There is a growing interest in methods of valuing experiences which benefit or harm us, but for which there is no money payment or compen- sation. Common examples of non-market goods we may wish to value are recreation sites and pollution. Alternative measurement approaches, such as the travel cost method, hedonic prices, and multi-attribute utility theory are well established in the research literature. Their application to agricultural and environmental projects is discussed by authors such as Anderson et al. (1977), Freeman (1979), and Sinden and Worrell(l979). An interesting, relatively recent approach based on consumption characteristics is proposed by Greig (1978). Sinden (1973 and 1974), Sinden and Wyckoff (1976) and Sinden and Worrell (1979) have advocated a method of deriving indifference curves for different combinations of use of two alternative recreation sites. The indifference curves are derived from total utility schedules which in turn art: derived from an interview procedure. The theoretical justification of the procedure rests on the postulates and implications of the expected utility theorem originally propounded by von Neumann and Morgenstern (1947). The advantage of an approach http://www.deepdyve.com/assets/images/DeepDyve-Logo-lg.png The Australian Journal of Agricultural Resource Economics Wiley

ON THE DERIVATION OF INDIFFERENCE CURVES FOR ESTIMATING CONSUMER SURPLUS

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Publisher
Wiley
Copyright
Copyright © 1980 Wiley Subscription Services, Inc., A Wiley Company
ISSN
1364-985X
eISSN
1467-8489
DOI
10.1111/j.1467-8489.1980.tb00584.x
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Abstract

ON THE DERIVATION OF INDIFFERENCE CURVES FOR ESTIMATING CONSUMER SURPLUS J. 0. S. KENNEDY La Trobe University, Bundoora, Vic. 3083 There is a growing interest in methods of valuing experiences which benefit or harm us, but for which there is no money payment or compen- sation. Common examples of non-market goods we may wish to value are recreation sites and pollution. Alternative measurement approaches, such as the travel cost method, hedonic prices, and multi-attribute utility theory are well established in the research literature. Their application to agricultural and environmental projects is discussed by authors such as Anderson et al. (1977), Freeman (1979), and Sinden and Worrell(l979). An interesting, relatively recent approach based on consumption characteristics is proposed by Greig (1978). Sinden (1973 and 1974), Sinden and Wyckoff (1976) and Sinden and Worrell (1979) have advocated a method of deriving indifference curves for different combinations of use of two alternative recreation sites. The indifference curves are derived from total utility schedules which in turn art: derived from an interview procedure. The theoretical justification of the procedure rests on the postulates and implications of the expected utility theorem originally propounded by von Neumann and Morgenstern (1947). The advantage of an approach

Journal

The Australian Journal of Agricultural Resource Economics – Wiley

Published: Dec 1, 1980

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