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Identifying demand parameters in the presence of unobservables: A combined revealed and stated preference approach

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  • von Haefen, Roger H.
  • Phaneuf, Daniel J.

Abstract

We develop a combined, revealed and stated preference approach to identify discrete choice demand parameters in the presence of unobserved determinants of choice. Our approach overcomes difficulties associated with small choice sets, multicollinearity, and endogeneity that arise with revealed preference approaches. To illustrate our framework, we revisit two Canadian moose hunting datasets. Our empirical results suggest the potential gains from fusing revealed and stated preference data, but they also suggest its limitations when the data-generating processes for the data sources differ.

Suggested Citation

  • von Haefen, Roger H. & Phaneuf, Daniel J., 2008. "Identifying demand parameters in the presence of unobservables: A combined revealed and stated preference approach," Journal of Environmental Economics and Management, Elsevier, vol. 56(1), pages 19-32, July.
  • Handle: RePEc:eee:jeeman:v:56:y:2008:i:1:p:19-32
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    Cited by:

    1. Richard T. Melstrom & Deshamithra H. W. Jayasekera, 2017. "Two-Stage Estimation to Control for Unobservables in a Recreation Demand Model with Unvisited Sites," Land Economics, University of Wisconsin Press, vol. 93(2), pages 328-341.
    2. Chen, Min & Lupi, Frank, 2009. "Does economic endogeneity of site facilities in recreation demand models lead to statistical endogeneity?," 2009 Annual Meeting, July 26-28, 2009, Milwaukee, Wisconsin 49449, Agricultural and Applied Economics Association.
    3. O. Morgan & John Whitehead & William Huth & Greg Martin & Richard Sjolander, 2013. "A Split-Sample Revealed and Stated Preference Demand Model to Examine Homogenous Subgroup Consumer Behavior Responses to Information and Food Safety Technology Treatments," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 54(4), pages 593-611, April.
    4. repec:eee:transa:v:105:y:2017:i:c:p:1-13 is not listed on IDEAS
    5. Dmitriy Volinskiy & Wiktor Adamowicz & Michele Veeman, 2011. "Predicting versus testing: a conditional cross‐forecasting accuracy measure for hypothetical bias," Australian Journal of Agricultural and Resource Economics, Australian Agricultural and Resource Economics Society, vol. 55(3), pages 429-450, July.
    6. Daniel J. Phaneuf & Laura O. Taylor & John B. Braden, 2013. "Combining Revealed and Stated Preference Data to Estimate Preferences for Residential Amenities: A GMM Approach," Land Economics, University of Wisconsin Press, vol. 89(1), pages 30-52.
    7. Abildtrup, Jens & Garcia, Serge & Olsen, Søren Bøye & Stenger, Anne, 2013. "Spatial preference heterogeneity in forest recreation," Ecological Economics, Elsevier, vol. 92(C), pages 67-77.
    8. Michael O’Hara, 2013. "Empirical identification of perceived congestion," Empirical Economics, Springer, vol. 45(3), pages 1167-1187, December.
    9. Mikołaj Czajkowski & Nick Hanley & Jacob LaRiviere, 2016. "Controlling for the Effects of Information in a Public Goods Discrete Choice Model," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 63(3), pages 523-544, March.
    10. O. Ashton Morgan & John C. Whitehead & William L. Huth & Gregory S. Martin & Richard Sjolander, 2013. "Accounting for Heterogeneity in Behavioral Responses to Health-Risk Information Treatments," Working Papers 13-05, Department of Economics, Appalachian State University.
    11. repec:eee:transb:v:109:y:2018:i:c:p:70-89 is not listed on IDEAS
    12. Hoyos, David & Riera, Pere, 2013. "Convergent validity between revealed and stated recreation demand data: Some empirical evidence from the Basque Country, Spain," Journal of Forest Economics, Elsevier, vol. 19(3), pages 234-248.
    13. Phaneuf, Daniel J. & Carbone, Jared C. & Herriges, Joseph A., 2009. "Non-price equilibria for non-marketed goods," Journal of Environmental Economics and Management, Elsevier, vol. 57(1), pages 45-64, January.
    14. Melstrom, Richard T. & Lee, Kangil & Byl, Jacob P., 2016. "The effect of endangered species regulations on local employment: Evidence from the listing of the lesser prairie chicken," 2016 Annual Meeting, July 31-August 2, 2016, Boston, Massachusetts 236254, Agricultural and Applied Economics Association.
    15. Norwood, F. Bailey & Lusk, Jayson L., 2011. "A calibrated auction-conjoint valuation method: Valuing pork and eggs produced under differing animal welfare conditions," Journal of Environmental Economics and Management, Elsevier, vol. 62(1), pages 80-94, July.
    16. Melstrom, Richard & Lupi, Frank, 2012. "Using a Control Function to Resolve the Travel Cost Endogeneity Problem in Recreation Demand Models," MPRA Paper 48036, University Library of Munich, Germany, revised May 2013.
    17. repec:eee:enepol:v:110:y:2017:i:c:p:288-302 is not listed on IDEAS
    18. Chen, Min & Lupi, Frank, 2013. "Modeling Long Overnight Trips by Chaining Recreation Sites," 2013 Annual Meeting, August 4-6, 2013, Washington, D.C. 150489, Agricultural and Applied Economics Association.
    19. Chen, Min, 2009. "Does Economic Endogeneity of Site Facilities in Recreation Demand Models Lead to Statistical Endogeneity?," Graduate Research Masters Degree Plan B Papers 55808, Michigan State University, Department of Agricultural, Food, and Resource Economics.
    20. repec:kap:enreec:v:68:y:2017:i:4:d:10.1007_s10640-016-0060-0 is not listed on IDEAS
    21. Cheng, Li & Lupi, Frank, 2016. "Combining Revealed and Stated Preference Methods for Valuing Water Quality Changes to Great Lakes Beaches," 2016 Annual Meeting, July 31-August 2, 2016, Boston, Massachusetts 235746, Agricultural and Applied Economics Association.

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