IDEAS home Printed from https://ideas.repec.org/a/sae/urbstu/v41y2004i10p2025-2041.html
   My bibliography  Save this article

Estimating the Public Good Value of Preserving a Local Historic Landmark: The Role of Non-substitutability and Citizen Information

Author

Listed:
  • Robert W. Kling

    (Department of Economics, Colorado State University, Campus Box 1771, Fort Collins, Colorado 80523-1771, USA, robert.kling@colostate.edu)

  • Charles F. Revier

    (Department of Economics, Colorado State University, Campus Box 1771, Fort Collins, Colorado 80523-1771, USA, charles.revier@colostate.edu)

  • Karin Sable

    (Department of Economics, University of Puget Sound, 1500 N. Warner St, Tacoma, Washington 98416 USA, ksable@ups.edu)

Abstract

This study applies stated-preference methods to estimate the public good values of preservation and restoration of a local historic landmark in a medium-sized US city. The survey device centres on a referendum-style dichotomous-choice question regarding city participation in a restoration partnership. Use of a double-split sample allows analysis of the effect on valuation of both heritage information and willingness-to-pay versus willingness-to-accept constructs, where the latter is approached by the method of paired comparison, allowing a non-substitutability effect to be separated from any endowment effect. Econometric analysis using a standard binary logit model indicates the existence of a strong non-substitutability effect and a significant information effect that further suggests the importance of non-substitutability in valuation.

Suggested Citation

  • Robert W. Kling & Charles F. Revier & Karin Sable, 2004. "Estimating the Public Good Value of Preserving a Local Historic Landmark: The Role of Non-substitutability and Citizen Information," Urban Studies, Urban Studies Journal Limited, vol. 41(10), pages 2025-2041, September.
    • Handle: RePEc:sae:urbstu:v:41:y:2004:i:10:p:2025-2041
    DOI: 10.1080/0042098042000256369
    as

    Download full text from publisher

    File URL: https://journals.sagepub.com/doi/10.1080/0042098042000256369
    Download Restriction: no
    File URL: https://libkey.io/10.1080/0042098042000256369?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    References listed on IDEAS

    as
    1. Trine Hansen, 1997. "The Willingness-to-Pay for the Royal Theatre in Copenhagen as a Public Good," Journal of Cultural Economics, Springer;The Association for Cultural Economics International, vol. 21(1), pages 1-28, March.
    2. Loomis, John & Peterson, George & Champ, Patricia & Brown, Thomas & Lucero, Beatrice, 1998. "Paired comparison estimates of willingness to accept versus contingent valuation estimates of willingness to pay," Journal of Economic Behavior & Organization, Elsevier, vol. 35(4), pages 501-515, May.
    3. W. Michael Hanemann, 1989. "Welfare Evaluations in Contingent Valuation Experiments with Discrete Response Data: Reply," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 71(4), pages 1057-1061.
    4. Catherine M. Chambers & Paul E. Chambers & John C. Whitehead, 1998. "Contingent Valuation of Quasi-Public Goods: Validity, Reliability, and Application To Valuing a Historic Site," Public Finance Review, , vol. 26(2), pages 137-154, March.
    5. George L. Peterson & Thomas C. Brown, 1998. "Economic Valuation by the Method of Paired Comparison, with Emphasis on Evaluation of the Transitivity Axiom," Land Economics, University of Wisconsin Press, vol. 74(2), pages 240-261.
    6. Magat, Wesley A. & Kip Viscusi, W. & Huber, Joel, 1988. "Paired comparison and contingent valuation approaches to morbidity risk valuation," Journal of Environmental Economics and Management, Elsevier, vol. 15(4), pages 395-411, December.
    7. Amos Tversky & Daniel Kahneman, 1991. "Loss Aversion in Riskless Choice: A Reference-Dependent Model," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 106(4), pages 1039-1061.
    8. Karl C. Samples & John A. Dixon & KMarcia M. Gowen, 1986. "Information Disclosure and Endangered Species Valuation," Land Economics, University of Wisconsin Press, vol. 62(3), pages 306-312.
    9. Loehman, Edna & De, Vo Hu, 1982. "Application of Stochastic Choice Modeling to Policy Analysis of Public Goods: A Case Study of Air Quality Improvements," The Review of Economics and Statistics, MIT Press, vol. 64(3), pages 474-480, August.
    10. Hoehn, John P. & Randall, Alan, 1987. "A satisfactory benefit cost indicator from contingent valuation," Journal of Environmental Economics and Management, Elsevier, vol. 14(3), pages 226-247, September.
    11. Daniel Kahneman & Amos Tversky, 2013. "Prospect Theory: An Analysis of Decision Under Risk," World Scientific Book Chapters, in: Leonard C MacLean & William T Ziemba (ed.), HANDBOOK OF THE FUNDAMENTALS OF FINANCIAL DECISION MAKING Part I, chapter 6, pages 99-127, World Scientific Publishing Co. Pte. Ltd..
    12. Kevin J. Boyle, 1989. "Commodity Specification and the Framing of Contingent-Valuation Questions," Land Economics, University of Wisconsin Press, vol. 65(1), pages 57-63.
    13. Kahneman, Daniel & Knetsch, Jack L & Thaler, Richard H, 1990. "Experimental Tests of the Endowment Effect and the Coase Theorem," Journal of Political Economy, University of Chicago Press, vol. 98(6), pages 1325-1348, December.
    14. 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.
    15. Kip Viscusi, W. & Magat, Wesley A. & Huber, Joel, 1991. "Pricing environmental health risks: survey assessments of risk-risk and risk-dollar trade-offs for chronic bronchitis," Journal of Environmental Economics and Management, Elsevier, vol. 21(1), pages 32-51, July.
    16. Hanemann, W Michael, 1991. "Willingness to Pay and Willingness to Accept: How Much Can They Differ?," American Economic Review, American Economic Association, vol. 81(3), pages 635-647, June.
    17. David Throsby, 1997. "Seven Questions in the Economics of Cultural Heritage," Palgrave Macmillan Books, in: Michael Hutter & Ilde Rizzo (ed.), Economic Perspectives on Cultural Heritage, chapter 2, pages 13-30, Palgrave Macmillan.
    18. Shogren, Jason F. & Seung Y. Shin & Dermot J. Hayes & James B. Kliebenstein, 1994. "Resolving Differences in Willingness to Pay and Willingness to Accept," American Economic Review, American Economic Association, vol. 84(1), pages 255-270, March.
    19. John C. Bergstrom & John R. Stoll & Alan Randall, 1990. "The Impact of Information on Environmental Commodity Valuation Decisions," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 72(3), pages 614-621.
    20. Randall, Alan & Stoll, John R, 1980. "Consumer's Surplus in Commodity Space," American Economic Review, American Economic Association, vol. 70(3), pages 449-455, June.
    21. Blomquist, Glenn C. & Whitehead, John C., 1998. "Resource quality information and validity of willingness to pay in contingent valuation," Resource and Energy Economics, Elsevier, vol. 20(2), pages 179-196, June.
    22. Timothy Park & John B. Loomis & Michael Creel, 1991. "Confidence Intervals for Evaluating Benefits Estimates from Dichotomous Choice Contingent Valuation Studies," Land Economics, University of Wisconsin Press, vol. 67(1), pages 64-73.
    23. Randall, Alan & Ives, Berry & Eastman, Clyde, 1974. "Bidding games for valuation of aesthetic environmental improvements," Journal of Environmental Economics and Management, Elsevier, vol. 1(2), pages 132-149, August.
    24. Michael Hutter & Ilde Rizzo (ed.), 1997. "Economic Perspectives on Cultural Heritage," Palgrave Macmillan Books, Palgrave Macmillan, number 978-1-349-25824-6, December.
    25. Knetsch, Jack L, 1995. "Asymmetric Valuation of Gains and Losses and Preference Order Assumptions," Economic Inquiry, Western Economic Association International, vol. 33(1), pages 134-141, January.
    26. Jennifer Tkac, 1998. "The Effects of Information on Willingness-to-Pay Values of Endangered Species," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 80(5), pages 1214-1220.
    27. Boyce, Rebecca R, et al, 1992. "An Experimental Examination of Intrinsic Values as a," American Economic Review, American Economic Association, vol. 82(5), pages 1366-1373, December.
    28. Hoehn, John P. & Randall, Alan, 2002. "The effect of resource quality information on resource injury perceptions and contingent values," Resource and Energy Economics, Elsevier, vol. 24(1-2), pages 13-31, February.
    29. Bruno S. Frey, 1997. "The Evaluation of Cultural Heritage: Some Critical Issues," Palgrave Macmillan Books, in: Michael Hutter & Ilde Rizzo (ed.), Economic Perspectives on Cultural Heritage, chapter 3, pages 31-49, Palgrave Macmillan.
    30. Brown, Thomas C. & Gregory, Robin, 1999. "Why the WTA-WTP disparity matters," Ecological Economics, Elsevier, vol. 28(3), pages 323-335, March.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Alberini, Anna & Longo, Alberto, 2007. "Valuing the Cultural Monuments of Armenia: Bayesian Updating of Prior Beliefs in Contingent Valuation," Sustainability Indicators and Environmental Valuation Working Papers 9337, Fondazione Eni Enrico Mattei (FEEM).
    2. Douglas S. Noonan, 2013. "Market effects of historic preservation," Chapters, in: Ilde Rizzo & Anna Mignosa (ed.), Handbook on the Economics of Cultural Heritage, chapter 17, pages i-i, Edward Elgar Publishing.
    3. Armbrecht, John, 2014. "Use value of cultural experiences: A comparison of contingent valuation and travel cost," Tourism Management, Elsevier, vol. 42(C), pages 141-148.
    4. Wright, William C.C. & Eppink, Florian V., 2016. "Drivers of heritage value: A meta-analysis of monetary valuation studies of cultural heritage," Ecological Economics, Elsevier, vol. 130(C), pages 277-284.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Richard T. Carson, 2011. "Contingent Valuation," Books, Edward Elgar Publishing, number 2489.
    2. Brown, Thomas C. & Gregory, Robin, 1999. "Why the WTA-WTP disparity matters," Ecological Economics, Elsevier, vol. 28(3), pages 323-335, March.
    3. Veisten, Knut, 2007. "Contingent valuation controversies: Philosophic debates about economic theory," Journal of Behavioral and Experimental Economics (formerly The Journal of Socio-Economics), Elsevier, vol. 36(2), pages 204-232, April.
    4. Clive L Spash, 2008. "The Contingent Valuation Method: Retrospect and Prospect," Socio-Economics and the Environment in Discussion (SEED) Working Paper Series 2008-04, CSIRO Sustainable Ecosystems.
    5. Biel, Anders & Johansson-Stenman, Olof & Nilsson, Andreas, 2011. "The willingness to pay–willingness to accept gap revisited: The role of emotions and moral satisfaction," Journal of Economic Psychology, Elsevier, vol. 32(6), pages 908-917.
    6. Carol Mansfield, 1999. "Despairing Over Disparities: Explaining the Difference Between Willingness to Pay and Willingness to Accept," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 13(2), pages 219-234, March.
    7. Sayman, Serdar & Onculer, Ayse, 2005. "Effects of study design characteristics on the WTA-WTP disparity: A meta analytical framework," Journal of Economic Psychology, Elsevier, vol. 26(2), pages 289-312, April.
    8. Bass, Daniel A. & McFadden, Brandon R. & Messer, Kent D., 2021. "A case for measuring negative willingness to pay for consumer goods," Food Policy, Elsevier, vol. 104(C).
    9. Beja Jr, Edsel, 2012. "Two explanations to the willingness to accept and willingness to pay gap plus an alternative," MPRA Paper 36239, University Library of Munich, Germany.
    10. Li, Xiaoshu & Boyle, Kevin J. & Pullis, Genevieve, 2012. "Does On-site Experience Affect Responses to Stated Preference Questions?," 2012 Annual Meeting, August 12-14, 2012, Seattle, Washington 124991, Agricultural and Applied Economics Association.
    11. Kolstad, Charles D. & Guzman, Rolando M., 1999. "Information and the Divergence between Willingness to Accept and Willingness to Pay," Journal of Environmental Economics and Management, Elsevier, vol. 38(1), pages 66-80, July.
    12. Loomis, John & Peterson, George & Champ, Patricia & Brown, Thomas & Lucero, Beatrice, 1998. "Paired comparison estimates of willingness to accept versus contingent valuation estimates of willingness to pay," Journal of Economic Behavior & Organization, Elsevier, vol. 35(4), pages 501-515, May.
    13. Peter R. Mueser & Jay K. Dow, 1998. "Experimental Evidence on the Divergence Between Measures of Willingness to Pay and Willingness to Accept--The Role of Value Uncertainty," Experimental 9803001, University Library of Munich, Germany.
    14. Biel, Anders & Johansson-Stenman, Olof & Nilsson, Andreas, 2006. "Emotions, Morality and Public Goods: The WTA-WTP Disparity Revisited," Working Papers in Economics 193, University of Gothenburg, Department of Economics.
    15. Zhao, Jinhua & Kling, Catherine L., 2001. "A new explanation for the WTP/WTA disparity," Economics Letters, Elsevier, vol. 73(3), pages 293-300, December.
    16. Richard T. Carson & Miko_aj Czajkowski, 2014. "The discrete choice experiment approach to environmental contingent valuation," Chapters, in: Stephane Hess & Andrew Daly (ed.), Handbook of Choice Modelling, chapter 9, pages 202-235, Edward Elgar Publishing.
    17. Clem Tisdell & Clevo Wilson, 2006. "Information, Wildlife Valuation, Conservation: Experiments And Policy," Contemporary Economic Policy, Western Economic Association International, vol. 24(1), pages 144-159, January.
    18. repec:ken:wpaper:0603 is not listed on IDEAS
    19. Li, Xiaoshu & Boyle, Kevin J. & Holmes, Thomas P. & LaRouche, Genevieve Pullis, 2014. "The effect of on-site forest experience on stated preferences for low-impact timber harvesting programs," Journal of Forest Economics, Elsevier, vol. 20(4), pages 348-362.
    20. Robert J. Johnston & Kevin J. Boyle & Wiktor (Vic) Adamowicz & Jeff Bennett & Roy Brouwer & Trudy Ann Cameron & W. Michael Hanemann & Nick Hanley & Mandy Ryan & Riccardo Scarpa & Roger Tourangeau & Ch, 2017. "Contemporary Guidance for Stated Preference Studies," Journal of the Association of Environmental and Resource Economists, University of Chicago Press, vol. 4(2), pages 319-405.
    21. Tonin, Stefania, 2018. "Citizens’ perspectives on marine protected areas as a governance strategy to effectively preserve marine ecosystem services and biodiversity," Ecosystem Services, Elsevier, vol. 34(PB), pages 189-200.

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:sae:urbstu:v:41:y:2004:i:10:p:2025-2041. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: SAGE Publications (email available below). General contact details of provider: http://www.gla.ac.uk/departments/urbanstudiesjournal .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.