Discussion Paper

Choice Experiments in Environmental Impact Assessment: The Case of the Toro 3 Hydroelectric Project and the Recreo Verde Tourist Center in Costa Rica

May 6, 2011 | Dora Carías Vega, Francisco Alpízar

This was created in partnership with Environment for Development .


Choice experiments, a stated preference valuation method, are proposed as a tool to assign monetary values to environmental externalities during the ex-ante stages of environmental impactassessment. This case study looks at the impacts of the Costa Rican Institute of Electricity’s Toro 3 hydroelectric project and its affects on the Recreo Verde tourism center in San Carlos, Costa Rica.Compared to other valuation methods (e.g., travel cost and contingent valuation), choice experiments can create hypothetical but realistic scenarios for consumers and generate restoration alternatives for the affected good. Although they have limitations that must be taken into account in environmental impact assessments, incorporating economic parameters—especially resource constraints and tradeoffs—can substantially enrich the assessment process.