Willingness to Pay Estimation When Protest Beliefs are not Separable from the Public Good Definition
University of Nevada Reno Joint Economics Working Paper Series
Public good attributes that are correlated with protest beliefs but not separable from the good's value, would affect stated preference estimates of the WTP for the public good. Survey data collected to value a program to prevent ecosystem losses on Nevada rangelands, where the majority of land is publicly owned and managed, reveal more than half of the respondents exhibiting some protest belief. Of these, about 60% voted 'yes' to some nonzero bid amount. By treating protest beliefs and opposition to the proposed program as separate concepts, we systematically analyze their determinants and impacts on WTP. In this framework, people with protest beliefs may or may not vote 'no' to all bids and people may, without being protesters, answer 'no' to all dollar amounts. Multinomial logit regression results suggest that factors motivating people to protest and/or oppose the proposed program are so diverse that a single model does not provide a good fit. We estimate nested models and conclude that different underlying processes determine WTP for "protesters" ($34.02) and "non-protesters" ($69.56).
Rollins, K., M.D.R. Evans, M. Kobayashi, and A. Castledine. 2010. Willingness to pay estimation when protest beliefs are inseparable from the public good. University of Nevada Reno Joint Economics Working Paper No. 10-002.
Working Paper No. 10-002