Assessing the spatial dependence of welfare estimates obtained from discrete choice experiments
- 194 Downloads
We report results from a discrete choice experiment designed to assess the general public’s preferences regarding rural landscape improvements. Using a random parameters logit model to account for unobserved taste heterogeneity, we exploit the panel nature of the dataset to retrieve partworths, or willingness to pay (WTP) values, for every individual in the sample. We subsequently use the Moran’s I test statistic to gauge the spatial dependence of these estimates for a range of spatial extents. We find that WTP estimates are positively spatially autocorrelated, but the degree of homogeneity diminishes as the spatial extent becomes larger before it eventually becomes relatively stable.
KeywordsDiscrete choice experiments Moran’s I Random parameters logit Spatial dependence Willingness to pay
JEL ClassificationC25 Q51 Q53
Unable to display preview. Download preview PDF.
- Campbell, D., Hutchinson, W., Scarpa, R.: Incorporating discontinuous preferences into the analysis of discrete choice experiments. Environ. Res. Econ. (2008a). doi: 10.1007/s10640-008-9198-8
- Campbell, D., Hutchinson, W., Scarpa, R.: Using choice experiments to explore the spatial distribution of willingness to pay for rural landscape improvements. Environ. Plann. A (2008b). doi: 10.1068/a4038
- Cliff, A.D., Ord, J.K.: Spatial Processes: Models and Applications. Pion Limited, London (1981) Google Scholar
- Greene, W.H., Hensher, D.A., Rose, J.M.: Using classical simulation-based estimators to estimate individual WTP values. In: Scarpa, R., Alberini, A. (eds.) Applications of Simulation Methods in Environmental and Resource Economics, pp. 17–34. Springer, Dordrecht (2005), Chapter 2 CrossRefGoogle Scholar
- Louviere, J.J., Hensher, D.A.: Design and analysis of simulated choice or allocation experiments in travel choice modeling. Transp. Res. Rec. 890, 11–17 (1982) Google Scholar
- Scarpa, R., Willis, K.G., Acutt, M.: Individual-specific welfare measures for public goods: a latent class approach to residential customers of Yorkshire water. In: Koundouri, P. (ed.) Econometrics Informing Natural Resource Management, pp. 316–337. Edward Elgar, Cheltenham (2005), Chapter 14 Google Scholar
- Scarpa, R., Campbell, D., Hutchinson, W.G.: Benefits estimates for landscape improvements: sequential Bayesian design and respondents’ rationality in a choice experiment. Land Econ. 83(4), 617–634 (2007) Google Scholar
- Train, K.E.: Discrete Choice Methods with Simulation. Press Syndicate of the University of Cambridge, Cambridge (2003) Google Scholar