Estimating Willingness-to-Pay with Random Valuation Models: An Application to Lake Sevan, Armenia

Estimating Willingness-to-Pay with Random Valuation Models: An Application to Lake Sevan, Armenia

This paper presents a case study of willingness-to-pay (WTP) estimation using random valuation models. A contingent valuation survey was conducted in Yerevan, Armenia to estimate people's WTP for the protection of Lake Sevan. Three elicitation...

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Bibliographic Details
Main Authors:	Wang, Hua, Laplante, Benoit, Wu, Xun, Meisner, Craig
Format:	Policy Research Working Paper
Language:	English en_US
Published:	World Bank, Washington, D.C. 2013
Subjects:	ACTIONS AGRICULTURE AIR QUALITY CHANGE CONTINGENT VALUATION CORRELATIONS DATA COLLECTION DICHOTOMOUS CHOICE DISCUSSIONS ECONOMIC VALUE ENVIRONMENTAL PROTECTION ENVIRONMENTAL QUALITY INCOME INTERVIEWS MAIL SURVEYS MODELING OPINIONS PERCEPTIONS PRICE INCREASES PUBLIC GOOD QUESTIONNAIRE QUESTIONNAIRES RANDOM SAMPLES RESEARCH DESIGN RESEARCH FINDINGS RESEARCH WORKING PAPERS RESEARCHERS SAMPLE DESIGN SCENARIO SCENARIOS SMALL BUSINESS SURVEY DATA SURVEY IMPLEMENTATION UNEMPLOYMENT UNEMPLOYMENT RATE UTILITY FUNCTION WATERSHED WETLANDS WTP AGRICULTURE CONTINGENT VALUATION METHOD DEPOSITORY DISCHARGE ECONOMETRIC MODEL EXPENDITURE FINANCIAL ASSISTANCE FINANCIAL SUPPORT FORESTS HOUSEHOLDS HYDROELECTRIC POWER NONUSE VALUE PAYMENT CARDS STOCHASTIC THEORY WILLINGNESS TO PAY
Online Access:	http://documents.worldbank.org/curated/en/2004/08/5066130/estimating-willingness-to-pay-random-valuation-models-application-lake-sevan-armenia http://hdl.handle.net/10986/14158

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Summary:	This paper presents a case study of willingness-to-pay (WTP) estimation using random valuation models. A contingent valuation survey was conducted in Yerevan, Armenia to estimate people's WTP for the protection of Lake Sevan. Three elicitation formats-open-ended, closed-ended, and the stochastic payment card (SPC) approach-were used with split random samples. WTP models with heterogeneous errors were constructed and estimated with the survey data. The SPC approach produces a higher estimation of the mean WTP than both the open-ended and closed-ended approaches, while results from the open-ended and closed-ended elicitation formats are similar. Furthermore, contrary to research findings obtained in the United States, this study finds higher WTP estimations with mail surveys than with personal interviews.