Differences between Willingness-to-Pay Estimates from Open-Ended and Discrete-Choice Contingent Valuation Methods: The Effects of Heteroscedasticity

1998 ◽  
Vol 74 (2) ◽  
pp. 262 ◽  
Author(s):  
Bente Halvorsen ◽  
Kjartan Soelensminde
Keyword(s):  
Willingness To Pay ◽  
Contingent Valuation ◽  
Discrete Choice ◽  
Valuation Methods ◽  
Contingent Valuation Methods

scholarly journals Ethical Preferences and the Assessment of Existence Values: Does the Neoclassical Model Fit?

1986 ◽  
Vol 15 (2) ◽  
pp. 145-150 ◽  
Author(s):  
Steven F. Edwards
Keyword(s):  
Willingness To Pay ◽  
Contingent Valuation ◽  
Model Fit ◽  
Neoclassical Model ◽  
Valuation Methods ◽  
Ethical Commitment ◽  
Existence Values ◽  
Preference Structures ◽  
Contingent Valuation Methods

Some of the implications of ethical preferences for traditional welfare analyses of existence values are discussed in this paper and illustrated with a lexicographic model for preference structures. Although willingness-to-pay and willingness-to-sell are well-defined, their connection with Hicksian surpluses is lost when a person is motivated by an ethical commitment to others’ welfare. Researchers need to expand contingent valuation methods to collect information on underlying motives and types of preferences in order to identify respondents who fit the neoclassical model of egoistic man.

scholarly journals Economic Valuation of Tourism Attraction of Jatijajar Cave in Kebumen Regency

JEJAK ◽  
2018 ◽  
Vol 11 (1) ◽  
pp. 12-28
Author(s):  
Indah Susilowati ◽  
Angga Ferdinan Syah ◽  
Suharno Suharno ◽  
Jaka Aminata
Keyword(s):  
Willingness To Pay ◽  
Contingent Valuation ◽  
Economic Valuation ◽  
Primary Data ◽  
Purposive Sampling ◽  
Valuation Methods ◽  
Multistage Sampling ◽  
Contingent Valuation Methods

The research aims at estimating the level of Willingness to Pay of the tourists for the Tourism Attraction of Jatijajar Cave in Kebumen Regency. The primary data is obtained from 105 respondents by using the Multistage Sampling and five key persons by using the Purposive Sampling. The characteristics of respondents show that some of the tourists are male, around 21 to 30 years old. The result of Contingent Valuation Methods shows that the WTP of the tourists of Jatijajar Cave has the average about Rp 17,000.00 and the total value of WTP is about Rp 5,231,410,000.00. The novelty in this research is using Contingent Valuation Methods approach to educate the visitors through the hypothetical-market that has been built by two scenarios of willingness to pay for the visitors at Jatijajar Cave tourism attraction as a compensation for the development of tourism attraction.

Improving Validity Experiments of Contingent Valuation Methods: Results of Efforts to Reduce the Disparity of Hypothetical and Actual Willingness to Pay

1996 ◽  
Vol 72 (4) ◽  
pp. 450 ◽  
Author(s):  
John Loomis ◽  
Thomas Brown ◽  
Beatrice Lucero ◽  
George Peterson
Keyword(s):  
Willingness To Pay ◽  
Contingent Valuation ◽  
Valuation Methods ◽  
Contingent Valuation Methods

State of the Art of Contingent Valuation

2020 ◽  
Author(s):  
Tim Haab ◽  
Lynne Lewis ◽  
John Whitehead
Keyword(s):  
Contingent Valuation ◽  
Discrete Choice ◽  
Stated Preference ◽  
Revealed Preference ◽  
Choice Experiments ◽  
Discrete Choice Experiments ◽  
Actual Behavior ◽  
Stated Preference Methods ◽  
Valuation Methods ◽  
Hypothetical Scenario

The contingent valuation method (CVM) is a stated preference approach to the valuation of non-market goods. It has a 50+-year history beginning with a clever suggestion to simply ask people for their consumer surplus. The first study was conducted in the 1960s and over 10,000 studies have been conducted to date. The CVM is used to estimate the use and non-use values of changes in the environment. It is one of the more flexible valuation methods, having been applied in a large number of contexts and policies. The CVM requires construction of a hypothetical scenario that makes clear what will be received in exchange for payment. The scenario must be realistic and consequential. Economists prefer revealed preference methods for environmental valuation due to their reliance on actual behavior data. In unguarded moments, economists are quick to condemn stated preference methods due to their reliance on hypothetical behavior data. Stated preference methods should be seen as approaches to providing estimates of the value of certain changes in the allocation of environmental and natural resources for which no other method can be used. The CVM has a tortured history, having suffered slings and arrows from industry-funded critics following the Exxon Valdez and British Petroleum (BP)–Deepwater Horizon oil spills. The critics have harped on studies that fail certain tests of hypothetical bias and scope, among others. Nonetheless, CVM proponents have found that it produces similar value estimates to those estimated from revealed preference methods such as the travel cost and hedonic methods. The CVM has produced willingness to pay (WTP) estimates that exhibit internal validity. CVM research teams must have a range of capabilities. A CVM study involves survey design so that the elicited WTP estimates have face validity. Questionnaire development and data collection are skills that must be mastered. Welfare economic theory is used to guide empirical tests of theory such as the scope test. Limited dependent variable econometric methods are often used with panel data to test value models and develop estimates of WTP. The popularity of the CVM is on the wane; indeed, another name for this article could be “the rise and fall of CVM,” not because the CVM is any less useful than other valuation methods. It is because the best practice in the CVM is merging with discrete choice experiments, and researchers seem to prefer to call their approach discrete choice experiments. Nevertheless, the problems that plague discrete choice experiments are the same as those that plague contingent valuation. Discrete choice experiment–contingent valuation–stated preference researchers should continue down the same familiar path of methods development.

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