Conference Agenda

This paper investigates how positive and negative affective states influence stated preferences for public environmental goods, with implications for welfare analysis and policy evaluation. Using a discrete choice experiment on alternative waste management systems in Italy, we examine how positive and negative affect experienced at the time of preference elicitation shapes individuals’ willingness to pay and the consistency of their choices. Affective states are measured using the Positive and Negative Affect Schedule (PANAS) immediately prior to the choice tasks, capturing a generalized blend of both momentary (state) and dispositional (trait) affect.

Preferences are modelled through a heteroskedastic hybrid discrete choice framework that integrates positive and negative affect as latent variables in both the utility function and the scale parameter, allowing us to assess the effects on preference structure and choice randomness. Results show that higher negative affect is associated with lower willingness to pay for environmentally cooperative and effort-intensive attributes, such as additional waste sorting categories and textile collection. In contrast, higher positive affect reduces preference for the status quo and increases support for more sustainable waste management systems. Moreover, for both positive and negative affect, greater affective intensity leads to increased choice randomness, indicating reduced decision consistency.

These findings challenge standard assumptions of stable and context-independent preferences underlying stated preference methods. They highlight positive and negative affect as significant sources of heterogeneity and uncertainty in environmental valuation, with substantial implications for cost–benefit analysis and the design and timing of environmental policies.