This paper uses recently developed statistical techniques to achieve improved parameter estimates from models ofdichotomoiis choice contingent valuation data. Random effects associated with bid amounts presented to respondents are modelled alongside the variance of individual responses, to give a nested model which more truly reflects the structure of the data being analyzed. Quasi-likelihood methods for estimating parameters in such hierarchical models are discussed, and a simulation method for assessing goodness of fit is demonstrated. However, estimated parameters may still be biased, and hence, a parametric bootstrap technique is presented and compared to a delta method approximation. (JEL Q26).
|Number of pages||11|
|Publication status||Published - 1 Jan 1998|
- contingent valuation
- environmental economics
- willingness to pay