Some further implications of incorporating the warm glow of giving into welfare measures:: A comment on the use of donation mechanisms by Champ et al

Champ er al. [J. Environ. Management 33, 151-162 (1997)] claim that they have (a) explored the welfare implication of warm glow for Hicksian measures of value for public goods and (b) established that actual donations place a "theoretical lower bound" on such values. We extend their model to shaw that warm glow introduces non-neutrality between the value of the good under public and private provision. The resulting implication of noninvariance of the benefit measure within benefit-cost analysis is highlighted. We further demonstrate that, in an important area of application, the hypothesis of Champ et al. that donations place a lower bound on Hicksian values may be invalidated. (C) 1999 Academic Press.