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Welfare Evaluations in Contingent Valuation Experiments with Discrete Response Data: Reply

Welfare Evaluations in Contingent Valuation Experiments with Discrete Response Data: Reply Welfare Evaluations in Contingent Valuation Experiments with Discrete Response Data: Reply W. Michael Hanemann Both of the issues raised by Johansson, Kristrorn, non-negative random variable. In the latter case, the correct formula for C+ is of course that given by and Maler (JKM) are important and need to be aired. The first concerns the graphical representa­ JKM in their equation (9), namely tion of the expected willingness to pay (WTP) or to sell (WTS) that is implied by a logit or similar statis­ C+ = L ' [ 1 - G(A)]dA - foo G(A)dA; tical model fitted to data from a discrete-response contingent valuation survey. Such surveys were this is the general formula for the mean of an arbi­ pioneered by Bishop and Heberlein (BH), and it trary random variable.? I certainly was aware of the was the purpose of my paper to interpret their anal­ general formula; but, in the BH model that I was ysis in utility-theoretic terms. Having offered indi­ discussing, WTP is constrained to be non-negative viduals an opportunity to buy a hunting permit for a and the general formula reduces to (3). specified price (A), BH fitted a logit model to the Since the http://www.deepdyve.com/assets/images/DeepDyve-Logo-lg.png American Journal of Agricultural Economics Wiley

Welfare Evaluations in Contingent Valuation Experiments with Discrete Response Data: Reply

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Publisher
Wiley
Copyright
© Agricultural and Applied Economics Association
ISSN
0002-9092
eISSN
1467-8276
DOI
10.2307/1242685
Publisher site
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Abstract

Welfare Evaluations in Contingent Valuation Experiments with Discrete Response Data: Reply W. Michael Hanemann Both of the issues raised by Johansson, Kristrorn, non-negative random variable. In the latter case, the correct formula for C+ is of course that given by and Maler (JKM) are important and need to be aired. The first concerns the graphical representa­ JKM in their equation (9), namely tion of the expected willingness to pay (WTP) or to sell (WTS) that is implied by a logit or similar statis­ C+ = L ' [ 1 - G(A)]dA - foo G(A)dA; tical model fitted to data from a discrete-response contingent valuation survey. Such surveys were this is the general formula for the mean of an arbi­ pioneered by Bishop and Heberlein (BH), and it trary random variable.? I certainly was aware of the was the purpose of my paper to interpret their anal­ general formula; but, in the BH model that I was ysis in utility-theoretic terms. Having offered indi­ discussing, WTP is constrained to be non-negative viduals an opportunity to buy a hunting permit for a and the general formula reduces to (3). specified price (A), BH fitted a logit model to the Since the

Journal

American Journal of Agricultural Economics – Wiley

Published: Nov 1, 1989

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