A Choice Experiment to Estimate Risk Preferences for Groundwater Management

Last registered on January 08, 2021

Pre-Trial

Trial Information

General Information

Title
A Choice Experiment to Estimate Risk Preferences for Groundwater Management
RCT ID
AEARCTR-0006996
Initial registration date
January 08, 2021

Initial registration date is when the trial was registered.

It corresponds to when the registration was submitted to the Registry to be reviewed for publication.

First published
January 08, 2021, 11:42 AM EST

First published corresponds to when the trial was first made public on the Registry after being reviewed.

Locations

Primary Investigator

Affiliation
University of Arkansas

Other Primary Investigator(s)

PI Affiliation
University of Arkansas
PI Affiliation
University of Arkansas

Additional Trial Information

Status
In development
Start date
2021-02-01
End date
2022-01-01
Secondary IDs
Abstract
We conduct a survey-based choice experiment in order to jointly estimate endogenous discount rates and risk curvatures associated with the public’s willingness to pay (WTP) for long-term groundwater management in the Mississippi River Valley Alluvial Aquifer. The experimental choice design uses variation in the timing of the payment mechanism and in the probability of implementation to identify endogenous time and risk preferences, respectively. We include treatments that do not include the probability necessary for estimating risk preferences in order to examine its effect on the estimation of the time parameter, and we include treatments to examine information effects. We also examine the effect on time and risk preferences resulting from treatments where respondents are allowed to select their preferred payment schedule (with and without the probability for risk preferences) and a treatment where respondents can assign different percentage probabilities (adding to 100%) to their likelihood of selecting alternative payment schedules. In addition to time and risk preferences, we also estimate marginal WTP for groundwater services (jobs in agriculture, job security in agriculture, wildlife habitat, and wildlife habitat security) and for two distinct management policies (surface water infrastructure and managed aquifer recharge) relative to the status quo of subsidies for best management practices.
External Link(s)

Registration Citation

Citation
Kovacs, Kent, Rodolfo Nayga Jr. and Grant West. 2021. "A Choice Experiment to Estimate Risk Preferences for Groundwater Management." AEA RCT Registry. January 08. https://doi.org/10.1257/rct.6996
Experimental Details

Interventions

Intervention(s)
Intervention Start Date
2021-02-08
Intervention End Date
2021-12-31

Primary Outcomes

Primary Outcomes (end points)
The key outcome measures are:
1. WTP for MRVA groundwater management
2. Marginal WTP for groundwater services:
-Jobs from Irrigated Agriculture
-Security of Jobs from Irrigated Agriculture
-Wildlife Diversity and Abundance
-Security of Wildlife Diversity and Abundance
3. Marginal WTP for policy alternatives:
-Surface Water Infrastructure Alternative
-Managed Aquifer Recharge Alternative
4. Time Preference, i.e., discount rate (jointly estimated with WTP from Random Utility Model (RUM))
5. Risk Preference, i.e., risk curvature parameter
Primary Outcomes (explanation)

Secondary Outcomes

Secondary Outcomes (end points)
Secondary Outcomes (explanation)

Experimental Design

Experimental Design
Respondents will be randomly assigned to 1 of 15 treatment groups:
1. Control with lump sum payment
2. Control with delayed lump sum payment
3. Control with perpetual annual payment
4. Control with delayed perpetual annual payment
5. Information lump sum payment
6. Information delayed lump sum payment
7. Information
8. Information
9. No probability lump sum payment
10. No probability delayed lump sum payment
11. No probability perpetual annual payment
12. No probability delayed perpetual annual payment
13. Payment schedule choice
14. Payment schedule choice, no probability
15. Payment schedule choice, probabilistic choice
Experimental Design Details
Randomization Method
Randomization will be done via Qualtrics survey software.
Randomization Unit
Individual
Was the treatment clustered?
No

Experiment Characteristics

Sample size: planned number of clusters
0
Sample size: planned number of observations
2250
Sample size (or number of clusters) by treatment arms
1. 125
2. 125
3. 125
4. 125
5. 125
6. 125
7. 125
8. 125
9. 125
10. 125
11. 125
12. 125
13. 250
14. 250
15. 250
Minimum detectable effect size for main outcomes (accounting for sample design and clustering)
IRB

Institutional Review Boards (IRBs)

IRB Name
University of Arkansas Institutional Review Board
IRB Approval Date
2021-01-05
IRB Approval Number
2012304202

Post-Trial

Post Trial Information

Study Withdrawal

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Intervention

Is the intervention completed?
No
Data Collection Complete
Data Publication

Data Publication

Is public data available?
No

Program Files

Program Files
Reports, Papers & Other Materials

Relevant Paper(s)

Reports & Other Materials