Deriving and Testing Efficient Estimates of WTP Distributions in Destination Choice Models

By M. Thiene, Riccardo Scarpa. 2009

141 citations recorded by the source corpus.

Estimation of welfare measures is often a dominant driver in the empirical literature on nonmarket valuation. To this end, qualitative choice models based on random utility theory have been widely employed in outdoor recreation studies. A frequent goal of applied studies has been the estimation of welfare changes associated with site attribute changes at recreation sites in order to inform regulatory policy and resource management. We review the evolution of the methodology of random utility theory in this field with a focus on taste heterogeneity models and then focus on the recent proposal of specifying utility in the WTP-space (Train K, Weeks M (2005) Discrete choice models in preference space and willing-to-pay space. In: Scarpa R, Alberini A (eds) Applications of simulation methods in environmental and resource economics, chapter 1. Springer, Dordrecht, pp 1–16). Our empirical application is on outdoor alpine recreation data. We emphasize the efficiency and direct testing that using the maximum simulated likelihood estimator affords to practitioners using the WTP-space approach, and illustrate these with examples.

Subfields: Economics and Econometrics, Marketing, Sociology and Political Science

View Paper: https://www.semanticscholar.org/paper/0eeebd1fe1d46d543c9e46edf37acc3652916a7f

Citations in the corpus

• Using revealed preferences to estimate the Value of Travel Time to recreation sites (2014, unknown): “In addition, we can include some observed factors within the specification of the VTT (e.g. VTTn = n + incn, with incn = income of respondent n and directly test their significance with standard inference (e.g. Thiene and Scarpa, 2009).”