Our Klamath Basin Water Crisis
Fighting for Our Right to Irrigate Our Farms and Caretake Our Natural Resources


January 3, 2003

I am a consulting economist who works on water, energy and environmental
regulation issues.  I am not retained by any of the parties involved in the
Klamath River dispute.

I reviewed Aaron Douglas' paper for the USGS "CVM Benefits Estimates for
the Lower Klamath River" which was presented at Western Economics
Association meeting in Seattle on June 30.  I read the paper with great
interest knowing the potential implications to policy
making.  Unfortunately, the paper had numerous problems that undermined any
ability to draw policymaking implications.  And I was not alone.  Two other
reviewers, Todd Lee with NFMS (todd.lee@noaa.gov) and Kwangsuck Lee of
Seoul University (kwanglee@speed.skku.ac.kr) also found significant , and
different, problems as well.   I suggest contacting them as well to receive
their comments on the paper.

Douglas' paper has severe problems in the way that the contingent valuation
survey was administered, the sample size for comparison purposes, including
for the "control" group, a misspecification in the travel cost modeling,
anomalous results in the survey where recreational users were found to be
staying on AVERAGE several months on site, a misspecification in lost
income and wages, and a misidentification of avoided costs, particularly
for electricity and agricultural production.  I came to the conclusion that
no useful results could be drawn from the paper, that the paper would not
pass peer review, and that in fact in all likelihood the entire survey
process would have to be restarted from scratch.

I sent my comments to Douglas Posson at the USGS office in Ft. Collins.  He
brushed off my input, and USGS went ahead an published the report despite
the obvious errors that I pointed out.  I have attached those comments to
this email.

I would be more than happy to review the latest version of this paper and
provide you with more explicit comments.  I also suggest that you contact
my dissertation chair, Dr. Michael Hanemann at UC Berkeley
(hanemann@are.berkeley.edu) for comments on Douglas' paper.  I can suggest
several other commentators, including Doug Larson at UC Davis, John Loomis
at Colorado State, and Tom Wegge at TCW Economics, as well as the
researchers who work on natural resource damages at NOAA in Chevy Chase,
MD, including David Chapman.

Richard McCann
M.Cubed, Davis, California
(530) 757-6363

See full report.


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