Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/155260
Authors: 
Strazzera, Elisabetta
Genius, Margarita
Scarpa, Riccardo
Hutchinson, George
Year of Publication: 
2001
Series/Report no.: 
Nota di Lavoro, Fondazione Eni Enrico Mattei 97.2001
Abstract: 
Selectivity bias caused by protest responses in Contingent Valuation studies can be detected and corrected by means of sample selection models. This paper compares two methods: the Heckman 2-steps method and the full ML, applied to data on forest recreation - where WTP is elicited as a continuous variable. Either method has its own drawback: computational complexity for the ML method, susceptibility to collinearity problems for the 2-steps method. The latter problem is observed in our best fitting specification, with the ML estimator outperforming the 2-steps. In this application, overlooking the effect of protest responses would cause an upwards bias of the final estimates of WTP.
Subjects: 
Contingent valuation
protest responses
sample selection
MLE
two-steps method
JEL: 
C35
C51
C81
D60
H41
Q26
Document Type: 
Working Paper

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