This paper explores the implications of endogenous risk for the economic value of preventing groundwater contamination. We consider the analytical implications of endogenous risk for five key building blocks frequently used to structure studies of groundwater valuation: The probability and the...

We develop three propositions about the ex ante value of reduced risk. If there is a continuous outcome distribution and if self-protection influences outcome probability and severity, then: (1) unobservable utility terms cannot be eliminated from the ex ante value expressions; (2) knowledge of...

The concept of endogenous risk implies that an individual can privately influence many of the hazards he or she confronts. This realization has profound impacts on environmental policy, which in the past has been driven by an assumption of exogenous risk. Three key interdependencies now come to...

In a world of incomplete markets for environmental goods, ex ante planned expenditures rather than ex post realized outcomes explain the values individuals attach to these goods. We use the distance function to develop restrictions from a model of ex ante consumer behavior involving these goods....

Just as ecology has benefited from the economic theory of optimization, economics can benefit from the ecological theory of adaptation. We examine the impact of short-term, nongenetic adaptive self-protection on the values individuals attach to uncertain prospective environmental resources. We...

We design an experiment to test whether the rationality induced by market discipline spills over to nonmarket settings - a rationality spillover. Our results confirm this new phenomenon. The rationality induced by market discipline extends to the nonmarket setting, and these spillover effects...

This paper describes alternative empirical techniques of economic analysis to assess the monetary value of human health, and outlines the issues that arise when these techniques are transported to value environmental hazard interventions intended to improve the health of young children. It...

We estimate a directional distance function to assess the impacts of multiple time-varying parent and child inputs on a cluster of jointly produced child outcomes for children aged 7 to 13 years. The directional distance function specification avoids several well-known empirical problems...

We propose a static three-stage incentive-compatible, budget-balanced, execution-contingent scheme for a regulator to allocate biodiversity protection responsibilities across a landscape mosaic having multiple value-interdependent owners. The scheme motivates owners to truthfully report their...

We adopt a framework to specify a household's child development technology with a set of interdependent inputs and outputs, finding significant, productive dynamic effects due to young children's Head Start participation. Our panel data estimates show that initial counter-productive partial...