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Discrete/Continuous Choices in Contingent Valuation Surveys: Soil Conservation Decisions in Michigan
Author(s) -
Lohr Luanne,
Park Timothy
Publication year - 1994
Publication title -
applied economic perspectives and policy
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 1.4
H-Index - 49
eISSN - 2040-5804
pISSN - 2040-5790
DOI - 10.2307/1349516
Subject(s) - contingent valuation , valuation (finance) , payment , discrete choice , econometrics , willingness to accept , willingness to pay , economics , actuarial science , survey data collection , structural equation modeling , linkage (software) , computer science , microeconomics , mathematics , statistics , accounting , finance , biochemistry , chemistry , gene
A discrete/continuous model of participation in environmental programs is developed. A conditional expectation correction model is used to overcome the selectivity bias inherent in single‐equation approaches used to describe participation. The two‐equation model proposed explicitly recognizes the linkage between the discrete decision (participate or not) and the continuous decision (level of participation for enrollees). This approach yields a measure of willingness to accept payment for program participation that is not obtainable when level of participation alone is considered. A model using contingent valuation survey data assessing participation in the filter strip program in Michigan serves as an example.