USING CONJOINT-ANALYSIS TO DERIVE ESTIMATES OF COMPENSATING VARIATION

We use several approaches to derive estimates of Hicksian compensating variation from conjoint ratings data. The different estimation approa ches produced mixed results with respect to consistency with utility t heory, statistical significance of key variables, magnitude of welfare estimates, and confidence bounds on welfare estimates. These findings suggest conjoint analyses are not a panacea for the problems being de bated regarding contingent-valuation and travel-cost methodologies, an d conjoint questions appear to share many of the advantages and disadv antages associated with dichotomous-choice, contingent-valuation quest ions. (C) 1996 Academic Press, Inc.