Environmental and Resource Economics

, Volume 26, Issue 1, pp 45–56 | Cite as

Hedonic Price Analysis and Selectivity Bias

  • Phoebe Koundouri
  • Panos Pashardes


Hedonic valuation of quality attributes can be misleading when theassumption that these attributes are exogenous to sample selection isviolated. This paper considers the simultaneity between hedonic valuationand sample selection in the context of a model of producer behavior andinvestigates empirically the case where land is demanded for use as an inputeither in agricultural production or in touristic development. The empiricalanalysis suggests that failing to correct for sample selection results in abiased valuation of the effect of water salinity on agricultural land.

quality resource environmental valuation sample selection bias separability 


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Copyright information

© Kluwer Academic Publishers 2003

Authors and Affiliations

  • Phoebe Koundouri
    • 1
    • 2
  • Panos Pashardes
    • 3
  1. 1.University of ReadingReading
  2. 2.University College LondonLondonUK
  3. 3.University of CyprusNicosiaCyprus

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