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Abstract
This paper provides a critical review of the literature on non-market valuation methods to
estimate the welfare impact of novel products; it is the first study to assess both observed
data- and perception-based methods as non-market valuation methods. Observed databased
methods include budgets, regression, mathematical programming, and simulation.
Perceptions-based methods include the contingent valuation method, choice-based
conjoint analysis and experimental methods.
Findings imply that the preferred observed data-based method to estimate the ex ante
economic impact of a new technology on the welfare of the farm household is a
combination of simulation and mathematical programming. The preferred perception-based
method for estimating the ex ante impact of a novel product on the welfare of an
economic agent is represented by experimental methods.
Findings also imply that observed-data based methods and more specifically
mathematical programming are more popular for estimating the ex ante farm-level
economic impact of a new technology. On the other hand, perception-based methods are
more popular for estimating the economic impact of a novel product for consumers.