Estimation of distance-decay functions to account for substitution and spatial heterogeneity in stated preference research

Marije Schaafsma, Roy Brouwer, Alison Gilbert, Jeroen van den Bergh, Alfred Wagtendonk

Research output: Contribution to journalArticleResearchpeer-review

49 Citations (Scopus)

Abstract

In a site-selection choice experiment various hypotheses are tested related to spatial heterogeneity in willingness to pay (WTP) for environmental improvements. Spatial heterogeneity is measured through distance-decay effects, substitute sites inside and outside the experiment's choice set, and spatial trend variables. We demonstrate that distancedecay functions differ between users and nonusers and across study sites. Also the distance to substitutes outside the choice set explains spatial variation in WTP. We show that further extending the model with spatial trend variables reveals additional spatial heterogeneity in choices. Accounting for spatial heterogeneity patterns results in significantly different WTP estimates for environmental improvements. © 2013 by the Board of Regents of the University of Wisconsin System.
Original languageEnglish
Pages (from-to)514-537
JournalLand Economics
Volume89
Issue number3
DOIs
Publication statusPublished - 1 Jan 2013

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