IMPROVED ESTIMATION OF WILLINGNESS-TO-PAY IN DICHOTOMOUS CHOICE CONTINGENT VALUATION STUDIES

This paper lases recently developed statistical techniques to achieve improved parameter estimates from models of dichotomous choice conting ent valuation data. Random effects associated with bid amounts present ed to respondents are modelled alongside the variance of individual re sponses, to give a nested model which more truly reflects the structur e of the delta being analyzed. Quasi-likelihood methods for estimating parameters in such hierarchical models are discussed, and a simulatio n method for assessing goodness of fit is demonstrated However; estima ted parameters may still be biased and hence, a parametric bootstrap t echnique is presented and compared to a delta method approximation.