Working Papers

The WNE Working Papers series has been published by the Faculty of Economic Sciences at the University of Warsaw since 2008.

The WNE Working Papers series provides a fast, open channel for disseminating research conducted at the Faculty of Economic Sciences, University of Warsaw. The papers hosted here are working versions (pre-prints) and may evolve as authors refine their analyses, incorporate feedback, or progress through formal peer-review. What you read is the current version released by the authors, timestamped and assigned DOI/ISSN identifiers to ensure precise citation and version tracking. Copyright remains with the authors, who may, at any time, upload a revised file or add a note directing readers to a later, peer-reviewed publication.

The Working Papers series accepts articles by research employees of the Faculty and publications from conferences organised at the Faculty of Economic Sciences at the University of Warsaw. Articles should be original research papers which have not been previously published, on the subject of economics.

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Number of Results 6

WP(24/2018)283. A Monte Carlo investigation of the effects of spatial heterogeneity of preferences for discrete choice models

Authors: Budziński Wiktor, Czajkowski Mikołaj
There are reasons researchers may be interested in accounting for spatial heterogeneity of preferences, including avoiding model misspecification and the resulting bias, and deriving spatial maps of willingness-to-pay (WTP), which are relevant for po…

WP283. A Monte Carlo investigation of the effects of spatial heterogeneity of preferences for discrete choice models

There are reasons researchers may be interested in accounting for spatial heterogeneity of preferences, including avoiding model misspecification and the resulting bias, and deriving spatial maps of willingness-to-pay (WTP), which are relevant for policy-making and environmental management. We employ a Monte Carlo simulation of three econometric approaches to parametrically account for spatial auto-correlation in discrete choice models. The first is based on the analysis of individual-specific estimates of the mixed logit model. The second extends this model to explicitly account for spatial correlation, instead of simply conditioning individual-specific estimates on population-level distributions and individuals' choices. The third is the geographically weighted multinomial logit model, which incorporates spatial dimensions using geographical weights to estimate location-specific choice models. We analyze the performance of these methods in recovering population-, region- and individual-level preference parameter estimates and implied WTP in the case of spatial autocorrelation. We find that, although ignoring spatial autocorrelation did not significantly bias population-level results of the simple mixed logit model, neither individual-specific estimates nor the geographically weighted multinomial logit model was able to reliably recover the true region- and individual-specific parameters. We show that the spatially-autocorrelated mixed logit proposed in this study is promising and outline possibilities for future development.


DOI: http://doi.org.10.26405/WP/WNE/2018/283/024
Budziński Wiktor, Czajkowski Mikołaj
discrete choice experiment discrete choice models individual- region- and population-level parameter estimates preference heterogeneity spatial auto-correlation

WP(19/2018)278. Impact of beliefs about negative effects of wind turbines on preference heterogeneity regarding renewable energy development in Poland

Authors: Bartczak Anna, Budziński Wiktor, Gołębiowska Bernadeta
We investigate individuals' preferences for renewable energy development in Poland. Our main objective is to examine whether preferences for avoiding externalities from renewable energy development near respondents' place of residence are inf…

WP278. Impact of beliefs about negative effects of wind turbines on preference heterogeneity regarding renewable energy development in Poland

We investigate individuals' preferences for renewable energy development in Poland. Our main objective is to examine whether preferences for avoiding externalities from renewable energy development near respondents' place of residence are influenced by their personal beliefs about the negative effects of wind turbine activity. We focus on attitudes towards wind power because it has had the most dynamic development among all renewable energy sources in Poland. To elicit values on avoiding renewable energy externalities, we use a choice experiment (CE) approach. To conduct our analysis we applied a theoretically robust econometric approach, the hybrid mixed logit model. From our analysis of data from a large sample of the Polish population, we find that beliefs about wind turbine have distinct negative effects on respondents' preferences concerning renewable energy development. Respondents who generally have an opinion about potential wind turbine effects would like to have input on renewable energy development in their neighbourhood. Latent beliefs that wind power is not harmful enhance respondents' preferences for implementing a wind energy project and enhance preferences against solar power development. These beliefs appears to be significantly correlated with respondents' marginal utility of money.


DOI: http://doi.org.10.26405/WP/WNE/2018/278/019
Bartczak Anna, Budziński Wiktor, Gołębiowska Bernadeta
beliefs about negative effects choice experiment preference heterogeneity renewable energy externalities stated preferences

WP(11/2017)240. Personality and Economic Choices

Authors: Boyce Christopher, Czajkowski Mikołaj, Hanley Nick
In this paper, we undertake the first examination of the effects of personality on individual economic choices over public environmental goods, using a stated preference approach. Based on three data sets from three separate choice modelling studies,…

WP240. Personality and Economic Choices

In this paper, we undertake the first examination of the effects of personality on individual economic choices over public environmental goods, using a stated preference approach. Based on three data sets from three separate choice modelling studies, we examine the effects of personality on preferences for the status quo, for changes in environmental quality, and over the costs of investing in environmental improvement. Using a hybrid choice framework, we show that incorporating personality research into economic models can provide valuable behavioural insights, enriching explanations of why the demand for environmental goods varies across people.


DOI: https://doi.org/10.26405/WP/WNE/2017/240/011
Boyce Christopher, Czajkowski Mikołaj, Hanley Nick
personality preference heterogeneity hybrid choice models stated preferences choice models

WP(1/2017)230. Stated Preference valuation methods: an evolving tool for understanding choices and informing policy

Authors: Hanley Nick, Czajkowski Mikołaj
We examine the value of Stated Preference (SP) valuation methods as part of the environmental economist's toolbox. We review a number of policy design issues where we believe SP methods have advantages over alternative approaches. We also discuss…

WP230. Stated Preference valuation methods: an evolving tool for understanding choices and informing policy

We examine the value of Stated Preference (SP) valuation methods as part of the environmental economist's toolbox. We review a number of policy design issues where we believe SP methods have advantages over alternative approaches. We also discuss the role of SP methods in exploring a few aspects of peoples' preferences and values which have wider implications for economics and behavioral sciences: (a) the effects of information, learning and knowledge; (b) testing the standard model of compensatory, rational choice; (c) the influence of behavioural levers such as social norms; and (d) the role of "deep" drivers of preference heterogeneity, such as personality and emotions. We also review what is known about the extent to which hypothetical choices reveal something about people's true preferences. Finally, we speculate on some areas where SP methods may be useful in the future.


DOI: https://doi.org/10.26405/WP/WNE/2017/230/001
Hanley Nick, Czajkowski Mikołaj
stated preferences non-market valuation environmental economics methods information choice social norms preference heterogeneity

WP(26/2016)217. Understanding the distribution of economic benefits from improving coastal and marine ecosystems

Authors: Pakalniete Kristine, Aigars Juris, Czajkowski Mikołaj, Strake Solvita, Zawojska Ewa, Hanley Nick
The ecological status of coastal and marine waterbodies world-wide is threatened by multiple stressors, including nutrient inputs from various sources and increasing occurrences of invasive alien species. These stressors impact the environmental qual…

WP217. Understanding the distribution of economic benefits from improving coastal and marine ecosystems

The ecological status of coastal and marine waterbodies world-wide is threatened by multiple stressors, including nutrient inputs from various sources and increasing occurrences of invasive alien species. These stressors impact the environmental quality of the Baltic Sea. Each Baltic Sea country contributes to the stressors and, at the same time, is affected by their negative impacts on water quality. Understanding who benefits from improvements in coastal and marine waters is key to assessing public support for policies aimed at achieving such changes. We propose a new approach to account for variability in benefits related to differences in socio-demographics of respondents, by using a structural model of discrete choice. Our method (1) provides a convenient way of incorporating a wide range of socio-demographics as explanatory variables in conditional multinomial logit models without the risk of collinearity, and (2) is more statistically efficient than the alternative, typically used approaches. The new technique is applied in a study which examines the preferences of Latvian citizens towards improvements of the coastal and marine environment quality that could help the Baltic Sea waters of Latvia reach Good Environmental Status as required by the European Union's Marine Strategy Framework Directive. Applying the discrete choice experiment method, we find that overall, Latvians are willing to pay for reducing losses of biodiversity, for improving water quality for recreation by reduced eutrophication, and for reducing new occurrences of invasive alien species. A significant group within the sample seems not to value environmental improvements in the Baltic Sea, and, thus, is unwilling to support costly measures for achieving such improvements. The structural model of discrete choice reveals substantial heterogeneity among Latvians towards changes in the quality of coastal and marine waters of Latvia.


Pakalniete Kristine, Aigars Juris, Czajkowski Mikołaj, Strake Solvita, Zawojska Ewa, Hanley Nick
good environmental status coastal and marine water quality biodiversity invasive alien species eutrophication discrete choice experiment observed preference heterogeneity socio-demographic characteristics hybrid choice model

WP(7/2012)73. We want to sort! - assessing households' preferences for sorting waste

Authors: Czajkowski Mikołaj, Kądziela Tadeusz, Hanley Nick
There are two major ways in which solid waste can be sorted and recycled - at the household level, when households are required to sort waste into a given number of categories, or in specialized sorting facilities. Traditionally, it has been thought …

WP73. We want to sort! - assessing households' preferences for sorting waste

There are two major ways in which solid waste can be sorted and recycled - at the household level, when households are required to sort waste into a given number of categories, or in specialized sorting facilities. Traditionally, it has been thought that sorting at the household level is an inconvenience, as it uses space and requires time and consideration. Our study provides empirical evidence to the contrary. Through a carefully designed choice experiment we collected stated choices of the members of a Polish municipalities with respect to the way their waste is sorted and how often it is collected. In the scenario of our study, respondents were informed that the waste will be sorted anyway - if not at the household level than at a specialized sorting facility. Interestingly, analysis of the preferences of members of the general public shows, that people are willing to sort waste at the household level, even if unsorted waste would be collected at no extra cost. We calculate maximum willingness to pay for collecting sorted vs. unsorted waste, as well for increased frequency of collection. Overall, our results provide encouraging evidence that most people prefer to sort waste themselves if given the choice, and thus demonstrate their pro-environment preferences, even without economic incentives to do so.


Czajkowski Mikołaj, Kądziela Tadeusz, Hanley Nick
waste management recycling consumers' motives preference heterogeneity
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