Laura Nahuelhual-Muñoz () Maria Loureiro () John Loomis ()
Abstract
Some public programs simultaneously provide a mix of non-rejectable public goods and public bads. Consequently, some individuals would pay for the program, while others might instead need to becompensated. In this paper we estimate twoparametric extended spike models that accountfor positive and negative preferences as wellas indifference for the public good. Weillustrate the models using data on valuationof prescribed burning of underbrush in forests,which reduces the risk of catastrophicwildfires but also produces smoke emissions(the public bad). We compare the two empiricalapproaches to estimate willingness to pay (WTP)for the program and contrast these results withthose obtained from modeling specificationsthat only account for non-negative preferences.Substantial differences in public net benefitswere found between the most flexible parametricextended spike model and the simple spike modelwhere negative responses were coded as zero anda standard binary logit of only positivebidders. The results from the extended spikemodels demonstrated that accounting forindifference and negative values towards thepublic good resulted in substantially lowerwillingness to pay estimates. Copyright Kluwer Academic Publishers 2004
Download Info
To download:
If you experience problems downloading a file, check if you have the
proper application to
view it first. Information about this may be contained
in the File-Format links below. In case of further problems read
the IDEAS help
file. Note that these files are not on the IDEAS
site. Please be patient as the files may be large.
As the access to this document is restricted, you may want to look for a different version under "Related research" (further below) or search for a different version of it.
References listed on IDEAS Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
Cited by: (explanations, Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.)