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 9

WP(26/2018)285. Benefit Transfer and Commodity Measurement Scales: Consequences for Validity and Reliability

Authors: Johnston Robert J., Zawojska Ewa
Non-market goods can be measured on cardinal or relative scales. Consider a marsh of two hundred acres, of which twenty acres would be affected by a policy. The same affected area can be measured in cardinal terms (twenty acres) or as a relative prop…

WP285. Benefit Transfer and Commodity Measurement Scales: Consequences for Validity and Reliability

Non-market goods can be measured on cardinal or relative scales. Consider a marsh of two hundred acres, of which twenty acres would be affected by a policy. The same affected area can be measured in cardinal terms (twenty acres) or as a relative proportion (ten percent of the marsh). This seemingly inconsequential transformation can have significant implications for benefit transfer across sites—a simple observation that remains unacknowledged by the literature. This article provides the first theoretical and empirical evaluation of variable measurement conventions within benefit transfer, deriving conditions under which different types of measurement scales are expected to enhance validity and reliability. Theoretical results are illustrated using an application of discrete choice experiments to coastal flood adaptation in two Connecticut (USA) communities. Empirical findings validate expectations from the theoretical model, with both suggesting that transfers over goods measured in relative units may substantially outperform transfers over goods measured in cardinal units.


DOI: http://doi.org.10.26405/WP/WNE/2018/285/026
Johnston Robert J., Zawojska Ewa
Benefit Transfer; Flood Adaptation; Measurement; Scale; Reliability; Stated Preference; Validity; Willingness to Pay

WP(20/2017)249. Hyperbolic grids and discrete random graphs

Authors: Kopczyński Eryk, Celińska Dorota
We present an efficient algorithm for computing distances in hyperbolic grids. We apply this algorithm to work efficiently with a discrete variant of the hyperbolic random graph model. This model is gaining popularity in the analysis of scale-free ne…

WP249. Hyperbolic grids and discrete random graphs

We present an efficient algorithm for computing distances in hyperbolic grids. We apply this algorithm to work efficiently with a discrete variant of the hyperbolic random graph model. This model is gaining popularity in the analysis of scale-free networks, which are ubiquitous in many fields, from social network analysis to biology. We present experimental results conducted on real world networks.


DOI: https://doi.org/10.26405/WP/WNE/2017/249/020
Kopczyński Eryk, Celińska Dorota
computational geometry hyperbolic geometry scale-free networks hyperbolic random graphs

WP(30/2016)221. Linking perceived choice complexity with scale heterogeneity in discrete choice experiments: home heating in Finland

Authors: Ruokamo Enni, Czajkowski Mikołaj, Hanley Nick, Juutinen Artti, Svento Rauli
Choosing a specific heating system is a complex and difficult decision for homeowners as there exists a wide array of heating technologies with different characteristics that one can consider before purchasing. We include multiple heating technologie…

WP221. Linking perceived choice complexity with scale heterogeneity in discrete choice experiments: home heating in Finland

Choosing a specific heating system is a complex and difficult decision for homeowners as there exists a wide array of heating technologies with different characteristics that one can consider before purchasing. We include multiple heating technologies and attributes in our Choice Experiment design and explore the effect of perceived choice complexity on the randomness of choices. In particular, we investigate how different self-evaluated factors of choice complexity affect mean scale and scale variance. Our findings suggest that perceived choice complexity has a systematic impact on the parameters of econometric models of choice. However, there are differences between alternative self-evaluated complexity-related covariates. Results indicate that individuals who report that answering the choice tasks was difficult have less deterministic choices. Perceptions of the realism of home heating choice options also affect scale and scale variance.


Ruokamo Enni, Czajkowski Mikołaj, Hanley Nick, Juutinen Artti, Svento Rauli
Home heating Choice experiment Choice modelling Scale heterogeneity Generalized mixed logit Complexity

WP(15/2012)81. The Effects of Experience on Preference Uncertainty: Theory and Empirics for Public and Quasi-Public Goods

Authors: Czajkowski Mikołaj, Hanley Nick, LaRiviere Jacob
This paper develops a model of demand estimation in which consumers learn about their true preferences through consumption experiences. We develop a theoretical model of Bayesian updating, perform comparative statics over the model, and show how the …

WP81. The Effects of Experience on Preference Uncertainty: Theory and Empirics for Public and Quasi-Public Goods

This paper develops a model of demand estimation in which consumers learn about their true preferences through consumption experiences. We develop a theoretical model of Bayesian updating, perform comparative statics over the model, and show how the theoretical model can be consistently incorporated into a reduced form econometric model. We then estimate the model using data collected for two quasi-public goods. We find that the predictions of the theoretical exercise that additional experience with a good will make consumers more certain over their preferences in both mean and variance are supported in each case.


Czajkowski Mikołaj, Hanley Nick, LaRiviere Jacob
Bayesian demand estimation stated preference generalized multinomial logit scale scale variance

WP(14/2012)80. Valuing the chances of survival of two distinct Eurasian lynx populations in Poland. Do people want to keep doors open?

Authors: Bartczak Anna, Meyerhoff Jürgen
This survey deals with valuing the social benefits of increasing chances of survival of the two main Eurasian lynx populations in Poland: the Lowland population and the Carpathian one. The populations are exposed to different risks of extinction. Usi…

WP80. Valuing the chances of survival of two distinct Eurasian lynx populations in Poland. Do people want to keep doors open?

This survey deals with valuing the social benefits of increasing chances of survival of the two main Eurasian lynx populations in Poland: the Lowland population and the Carpathian one. The populations are exposed to different risks of extinction. Using a discrete choice experiment we examined the influence of the initial degree of endangerment of those lynx populations on respondents' funds allocation. The results show that instead of investing in the option with the expected higher outcome a main driver of individuals' decisions regarding the conservation of threatened species seems to be loss aversion. Thus, people seem to try to keep options (doors) open by investing more in the more vulnerable population. Moreover, employing a scale-extended latent class model allowed to detect segments among individuals showing different types of response behavior and therefore improved the accuracy of the willingness to pay estimates considerably compared to a conditional logit model.


Bartczak Anna, Meyerhoff Jürgen
discrete choice models loss aversion Lynx conservation scale-extended latent class model threatened species

WP(10/2012)76. More random or more deterministic choices? The effects of information on preferences for biodiversity conservation

Authors: Czajkowski Mikołaj, Hanley Nick
For many years, stated preference researchers have been interested in the effects of information on willingness to pay for environmental goods. Within the random utility model, information about an environmental good might impact on preferences and o…

WP76. More random or more deterministic choices? The effects of information on preferences for biodiversity conservation

For many years, stated preference researchers have been interested in the effects of information on willingness to pay for environmental goods. Within the random utility model, information about an environmental good might impact on preferences and on scale (error variance), both between and within samples of choices. In this paper, we extend the G-MNL model to investigate the effects of different information sets on choices over the management of biodiversity in the UK, looking specifically at moorlands managed for red grouse shooting. Specifically, we make the individual scale parameter a function of observable (dataset-specific) characteristics. Our results show that changing information sets results in significant differences in the mean scale between datasets, and in the variance of scale. Respondents are more deterministic in their choices and show lower within-sample scale heterogeneity in the alternative information treatment. Changes in information provision also effect willingness to pay estimates, reducing the value people place on the conservation of two iconic birds of prey. The methods used will also be of interest to researchers who need to combine choice experiment data sets.


Czajkowski Mikołaj, Hanley Nick
choice modelling information effects scale scale heterogeneity G-MNL heather moorland management raptor conservation combined SP-RP

WP(8/2012)74. Learning and Fatigue Effects Revisited. The Impact of Accounting for Unobservable Preference and Scale Heterogeneity on Perceived Ordering Effects in Multiple Choice Task Discrete Choice Experiments

Authors: Czajkowski Mikołaj, Giergiczny Marek, Greene William H.
Using multiple choice tasks per respondent in discrete choice experiment studies increase the amount of available information. However, treating repeated choice data in the same way as cross-sectional data may lead to biased estimates. In particular,…

WP74. Learning and Fatigue Effects Revisited. The Impact of Accounting for Unobservable Preference and Scale Heterogeneity on Perceived Ordering Effects in Multiple Choice Task Discrete Choice Experiments

Using multiple choice tasks per respondent in discrete choice experiment studies increase the amount of available information. However, treating repeated choice data in the same way as cross-sectional data may lead to biased estimates. In particular, respondents' learning and fatigue may lead to changes in observed utility function preference (taste) parameters, as well as its error term variance (scale). Substantial body of empirical research offers mixed evidence in terms of whether (and which) of these ordering effects are observed. In this study we point to a significant component in explaining these differences - we show how accounting for unobservable preference and scale heterogeneity can influence the magnitude of observed ordering effects, especially if combined with too few choice tasks used for the analysis. We do this by utilizing the state-of-the-art modeling methods (H-MNL, S-MNL, H-RPL, G-MNL) which we modify to accommodate choice task specific scale parameter. In addition, we investigate possible bias resulting from not accounting for ordering effects. Our empirical study was based in the context of environmental protection - management changes in the protection of Polish forests.


Czajkowski Mikołaj, Giergiczny Marek, Greene William H.
ordering effects learning fatigue preference and scale heterogeneity forest management recreation biodiversity

WP(3/2012)69. Municipal Wastewater Treatment in Poland - Efficiency, Costs and Returns to Scale

Authors: Berbeka Krzysztof, Czajkowski Mikołaj, Markowska Agnieszka
The paper reports the costs of municipal wastewater collection and treatment in Poland based on an empirical sample of 1400 operators. Treatment cost functions are investigated econometrically using the Box-Cox regression model, indicating high non-l…

WP69. Municipal Wastewater Treatment in Poland - Efficiency, Costs and Returns to Scale

The paper reports the costs of municipal wastewater collection and treatment in Poland based on an empirical sample of 1400 operators. Treatment cost functions are investigated econometrically using the Box-Cox regression model, indicating high non-linearity and significant scale effects. Wastewater treatment costs are increasing with technology efficiency (moving from the primary, through the secondary, to the tertiary treatment), and decreasing with higher wastewater treatment plant capacity. Combining treatment and collection costs with treatment efficiency allows estimation of costs and potentials for reducing the nitrogen and phosphorus loadings to rivers by improving the efficiency of wastewater treatments plants, or building new ones, on an aggregated country-wide scale. Therefore, our results provide valuable input into any cost-benefit analyses of nutrient loadings reduction through extending or upgrading municipal wastewater treatment systems.


Berbeka Krzysztof, Czajkowski Mikołaj, Markowska Agnieszka
municipal wastewater treatment costs scale effects nutrient loadings reductions nitrogen phosphorus

WP(4/2011)44. Demand linkages and spatial agglomeration of Indian states

Authors: Cieślik Andrzej, Prusty Sadananda
In this paper, we examine the spatial relationship between wages and consumer purchasing power across Indian states to see whether regional demand linkages contribute to spatial agglomeration. We estimate a variety of the market-potential functions d…

WP44. Demand linkages and spatial agglomeration of Indian states

In this paper, we examine the spatial relationship between wages and consumer purchasing power across Indian states to see whether regional demand linkages contribute to spatial agglomeration. We estimate a variety of the market-potential functions derived from the Harris model as well as more recent models of the New Economic Geography. Besides market-potential, we consider housing stock, density of roadways, density of telecom, and dummies to capture cyclical fluctuations as parameters of consumer purchasing power and demand to explore the importance of scale economies and transport costs. The estimation results suggest that all the above factors influence demand linkages between states, which are strong and growing over the period from 1999-2000 to 2007-2008.


Cieślik Andrzej, Prusty Sadananda
Spatial agglomeration Scale economies Wage differentials Regional studies
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