Statistical Approaches to the Fat Tail Problem for Dichotomous Choice Contingent Valuation
If a cumulative density function estimated from dichotomous choice data has an unrealistically fat right-hand tail, mean willingness to pay (WTP) will be overestimated. Truncating the range of integration results in a lower-bound estimate of the true mean WTP. A normalization procedure proposed by Boyle, Welsh, and Bishop (1988) unnecessarily depresses the estimate further. A new statistical approach is presented that allows a best-guess estimate of mean WTP. Because this estimate involves extrapolation beyond the range of the data, it tends to be highly variable.
If you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. 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.
When requesting a correction, please mention this item's handle: RePEc:uwp:landec:v:71:y:1995:i:4:p:491-499. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: ()
If references are entirely missing, you can add them using this form.