[Limdep Nlogit List] continuous or categorical price parameter should be used to estimate WTP
Mikołaj Czajkowski
miq at wne.uw.edu.pl
Sat Jan 17 22:03:57 EST 2009
Dear Rady,
Some studies would use alternative specific constant for the status quo
alternative, even if the attributes are generic. The interpretation
would be that the respondents do / do not have a utility premium for
changing the status quo. This can in some cases substantially change the
welfare measures.
A short paragraph suggesting some of the literature:
Including / excluding ASC in welfare estimates of the scenarios is
discussed by e.g. Adamowicz et al. (1998). Among many studies Rolfe et
al. (2000), Bennett et al. (2001), Horne et al. (2005), Horne (2006) and
Birol et al. (2006) included ASC in welfare estimates. On the contrary –
Xu et al. (2003), Lehtonen et al. (2003), Biénabe and Hearne (2006) and
Nielsen et al. (2007) include only implicit prices of physical
attributes. Finally Adamowicz et al. (1998), Garber-Yonts et al. (2004),
Watson et al. (2004), Mogas et al. (2005) and Meyerhoff et al.
(forthcoming) report problems that may be encountered when including /
excluding ASC in welfare estimates. It is thus safe to conclude that
including / excluding ASC may be decisive for welfare estimates.
Adamowicz WL, Boxall P, Williams M, Louviere JJ (1998) Stated Preference
Approaches to Measuring Passive Use Values: Choice Experiments versus
Contingent Valuation. American Journal of Agricultural Economics 80: 64-75
Bennett J, Rolfe J, Morrison MD (2001) Remnant Vegetation and Wetlands
Protection: Non-market Valuation. In: Bennett J, Blamey RK (eds) The
Choice Modelling Approach To Environmental Evaluation, Edward Elgar,
Cheltenham
Biénabe E, Hearne RR (2006) Public preferences for biodiversity
conservation and scenic beauty within the framework of environmental
services payments. Forest Policy and Economics 9: 335-348
Birol E, Karousakisb K, Koundouric P (2006) Using a Choice Experiment to
Account for Preference Heterogeneity in Wetland Attributes: The Case of
Cheimaditida Wetland in Greece. Ecological Economics 60: 145-156
Garber-Yonts BE, Kerkvliet J, Johnson R (2004) Public Values for
Biodiversity Conservation Policies in the Oregon Coast Range. Forest
Science 50: 589-602
Horne P (2006) Forest Owners’ Acceptance of Incentive Based Policy
Instruments in Forest Biodiversity Conservation – A Choice Experiment
Based Approach. Silva Fennica 40(1): 169–178
Horne P, Boxall CP, Adamowicz WL (2005) Multiple-use Management of
Forest Recreation Sites: A Spatially Explicit Choice Experiment. Forest
Ecology and Management 207: 189-199
Lehtonen E, Kuuluvainen J, Pouta E, Rekola M, Li C-Z (2003) Non-market
Benefits of Forest Conservation in Southern Finland. Environmental
Science & Policy 6(3): 195-204
Mogas J, Riera P, Bennett J (2005) Accounting for Afforestation
Externalities: A Comparison of Contingent Valuation and Choice
Modelling. European Environment 15: 44-58
Nielsen AB, Olsen SB, Lundhede T (2007) An Economic Valuation of the
Recreational Benefits Associated with Nature-Based Forest Management
Practices. Landscape and Urban Planning 80: 63-71
Rolfe J, Bennett J, Louviere J (2000) Choice Modelling and its Potential
Application to Tropical Rainforest Preservation. Ecological Economics
35: 289-302
Watson DO, McFarlane BL, Haener MK (2004) Human Dimensions of
Biodiversity Conservation in the Interior Forests of British Columbia.
BC Journal of Ecosystems and Management 4: 1-20
Xu W, Lippke BR, Perez-Garcia J (2003) Valuing Biodiversity, Aesthetics,
and Job Losses Associated with Ecosystem Management Using Stated
Preferences. Forest Science 49: 247-257
Whether the attributes should be dummy- or continuously coded probably
depends on your attributes and the design. Cost variable is usually
continuously coded, while dummy coding the levels of attributes allows
you to see if marginal utilities of subsequent increases are the same.
Good luck and best regards,
--
Mikolaj Czajkowski
Warsaw Ecological Economics Center
University of Warsaw
http://www.woee.pl/
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