Browsing by Author "Paul, Laura A."
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Item Demand for an Environmental Public Good in the Time of COVID-19: A Statewide Water Quality Referendum(Journal of Benefit-Cost Analysis, 2022-02-10) Parsons, George; Paul, Laura A.; Messer, Kent D.Due to COVID-19, many households faced hardships in the spring of 2020 – unemployment, an uncertain economic future, forced separation, and more. At the same time, the number of people who participated in outdoor recreation in many areas increased, as it was one of the few activities still permitted. How these experiences affect the public’s willingness to pay (WTP) for environmental public goods is unknown. During the early months of the pandemic, we conducted a stated preference survey to value statewide water quality improvements in Delaware. While a majority of participants report experiencing hardship of some sort (economic, emotional, etc.), mean household WTP declined by only 7 % by May 2020.Item Nudge or Sludge? An In-Class Experimental Auction Illustrating How Misunderstood Scientific Information Can Change Consumer Behavior(Applied Economics Teaching Resources, 2022-03-16) Paul, Laura A.; Savchenko, Olesya M.; Kecinski, Maik; Messer, Kent D.Scientific information can be used to help people understand and describe the world. For example, consumers regularly seek out information about their food and drink to help inform their purchasing decisions. Sometimes, however, consumers can respond negatively to this information, even when the information did not intend to convey a negative signal. These negative responses can be the result of misunderstandings or strong, visceral, emotional behavior, that can be challenging to foresee and once arisen, difficult (and expensive) to mitigate. In this paper, we show how educators can use an in-class economic experiment to introduce the power of a sludge—a small behavioral intervention that leads to worse outcomes. We provide a step-by-step guide to take students through a demand revealing design using a second-price, willingness-to-accept (WTA) auction that tests preferences for tap water and bottled water when students receive total dissolved solids (TDS) information. Additional classroom discussion topics are presented, including comparing nudges and sludges, the public response to the treatment of tap water, and the role of safety information in consumer response.Item Promoting Spatial Coordination in Flood Buyouts in the United States: Four Strategies and Four Challenges from the Economics of Land Preservation Literature(Natural Hazards Review, 2023-02-01) Dineva, Polina K.; McGranaghan, Christina; Messer, Kent D.; Palm-Forster, Leah H.; Paul, Laura A.; Siders, A. R.Managed retreat in the form of voluntary flood-buyout programs provides homeowners with an alternative to repairing and rebuilding residences that have sustained severe flood damage. Buyout programs are most economically efficient when groups of neighboring properties are acquired because they can then create unfragmented flood control areas and reduce the cost of providing local services. However, buyout programs in the United States often fail to acquire such efficient, unfragmented spaces, for various reasons, including long administrative timelines, the way in which buyout offers are made, desires for community cohesion, and attachments to place. Buyout programs have relied primarily on posted price mechanisms involving offers that are accepted or rejected by homeowners with little or no negotiation. In this paper, we describe four alternative strategies that have been used successfully in land-preservation agricultural–environmental contexts to increase acceptance rates and decrease fragmentation: agglomeration bonuses, reverse auctions, target constraints, and hybrid approaches. We discuss challenges that may arise during their implementation in the buyout context—transaction costs, equity and distributional impacts, unintended consequences, and social pressure—and recommend further research into the efficiency and equity of applying these strategies to residential buyout programs with the explicit goal of promoting spatial coordination.