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Valuing the cultural monuments of Armenia: Bayesian updating of prior beliefs in contingent valuation

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Author Info
Anna Alberini
Alberto Longo

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Abstract

The most appropriate way to measure the social benefits of conserving built cultural heritage sites is to ask the beneficiaries of conservation interventions how much they would be willing to pay for them. We use contingent valuation—a survey-based approach that elicits willingness to pay (WTP) directly from individuals—to estimate the benefits of a nationwide conservation of built cultural heritage sites in Armenia. The survey was administered to Armenian nationals living in Armenia, and obtained extensive information about the respondents’ perceptions of the current state of conservation of monuments in Armenia, described the current situation, presented a hypothetical conservation program, elicited WTP for it, and queried individuals about what they thought would happen to monument sites in the absence of the government conservation program. We posit that respondents combined the information about the fate of monuments provided by the questionnaire with their prior beliefs, and that WTP for the good, or program, is likely to be affected by these updated beliefs. We propose a Bayesian updating model of prior beliefs, and empirically implement it with the data from our survey. We found that uncertainty about what would happen to monuments in the absence of the program results in lower WTP amounts.

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Publisher Info
Article provided by Pion Ltd, London in its journal Environment and Planning A.

Volume (Year): 41 (2009)
Issue (Month): 2 (February)
Pages: 441-460
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Handle: RePEc:pio:envira:v:41:y:2009:i:2:p:441-460

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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.:
  1. Soma Bhattacharya & Anna Alberini & Maureen Cropper, 2007. "The value of mortality risk reductions in Delhi, India," Journal of Risk and Uncertainty, Springer, vol. 34(1), pages 21-47, February. [Downloadable!] (restricted)
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  2. Ajzen, Icek & Brown, Thomas C. & Rosenthal, Lori H., 1996. "Information Bias in Contingent Valuation: Effects of Personal Relevance, Quality of Information, and Motivational Orientation," Journal of Environmental Economics and Management, Elsevier, vol. 30(1), pages 43-57, January. [Downloadable!] (restricted)
  3. Douglas Noonan, 2003. "Contingent Valuation and Cultural Resources: A Meta-Analytic Review of the Literature," Journal of Cultural Economics, Springer, vol. 27(3), pages 159-176, November. [Downloadable!] (restricted)
  4. Viscusi, W Kip & O'Connor, Charles J, 1984. "Adaptive Responses to Chemical Labeling: Are Workers Bayesian Decision Makers?," American Economic Review, American Economic Association, vol. 74(5), pages 942-56, December. [Downloadable!] (restricted)
  5. David Throsby, 2003. "Determining the Value of Cultural Goods: How Much (or How Little) Does Contingent Valuation Tell Us?," Journal of Cultural Economics, Springer, vol. 27(3), pages 275-285, November. [Downloadable!] (restricted)
  6. Viscusi, W. Kip, 1985. "A Bayesian perspective on biases in risk perception," Economics Letters, Elsevier, vol. 17(1-2), pages 59-62. [Downloadable!] (restricted)
  7. Viscusi, W Kip, 1989. " Prospective Reference Theory: Toward an Explanation of the Paradoxes," Journal of Risk and Uncertainty, Springer, vol. 2(3), pages 235-63, September.
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  1. Andrea Leiter & Gerald Pruckner, 2009. "Proportionality of Willingness to Pay to Small Changes in Risk: The Impact of Attitudinal Factors in Scope Tests," Environmental & Resource Economics, European Association of Environmental and Resource Economists, vol. 42(2), pages 169-186, February. [Downloadable!] (restricted)
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