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Modelling zero bids in contingent valuation surveys

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  • E. Strazzera
  • R. Scarpa
  • P. Calia
  • G. Garrod
  • K. Willis

Abstract

When modelling data generated from a discrete choice contingent valuation question, the treatment of zero bids affects the welfare estimates. Zero bids may come from respondents who are not interested in the provision of the public good; alternatively, some zero-bidders may be protesting about the valuation exercise, but hold positive values for the good. In this paper we investigate the effect of different levels of information on zero-bidders on welfare estimates for the population. We find that different strategies of identification may have non-trivial effects. We recommend use of full debriefing questions for zero-bidders, and use of sample selection models to correct for bias caused by protest behaviour.

Suggested Citation

  • E. Strazzera & R. Scarpa & P. Calia & G. Garrod & K. Willis, 2000. "Modelling zero bids in contingent valuation surveys," Working Paper CRENoS 200006, Centre for North South Economic Research, University of Cagliari and Sassari, Sardinia.
    • Handle: RePEc:cns:cnscwp:200006
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    References listed on IDEAS

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    1. Trudy Ann Cameron, 1991. "Interval Estimates of Non-Market Resource Values from Referendum Contingent Valuation Surveys," Land Economics, University of Wisconsin Press, vol. 67(4), pages 413-421.
    2. P. Calia & E. Strazzera, 1999. "A Sample Selection Model for Protest Non-Response Votes in Contingent Valuation Analyses," Working Paper CRENoS 199905, Centre for North South Economic Research, University of Cagliari and Sassari, Sardinia.
    3. Cameron, Trudy Ann & James, Michelle D, 1987. "Efficient Estimation Methods for "Closed-ended' Contingent Valuation Surveys," The Review of Economics and Statistics, MIT Press, vol. 69(2), pages 269-276, May.
    4. Cameron, Trudy Ann, 1988. "A new paradigm for valuing non-market goods using referendum data: Maximum likelihood estimation by censored logistic regression," Journal of Environmental Economics and Management, Elsevier, vol. 15(3), pages 355-379, September.
    5. Richard T. Carson, 2011. "Contingent Valuation," Books, Edward Elgar Publishing, number 2489.
    6. Daniel McFadden, 1994. "Contingent Valuation and Social Choice," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 76(4), pages 689-708.
    7. Bengt Kriström, 1997. "Spike Models in Contingent Valuation," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 79(3), pages 1013-1023.
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    Cited by:

    1. M. Musumeci, 2000. "Innovazione tecnologica e beni culturali. Uno studio sulla situazione della Sicilia," Working Paper CRENoS 200008, Centre for North South Economic Research, University of Cagliari and Sassari, Sardinia.
    2. Rihar, Miha & Hrovatin, Nevenka & Zoric, Jelena, 2015. "Household valuation of smart-home functionalities in Slovenia," Utilities Policy, Elsevier, vol. 33(C), pages 42-53.
    3. C. Antonelli & R. Marchionatti & S. Usai, 2000. "Productivity and External Knowledge: The Italian Case," Working Paper CRENoS 200009, Centre for North South Economic Research, University of Cagliari and Sassari, Sardinia.
    4. Garcia, Serge & Harou, Patrice & Montagné, Claire & Stenger, Anne, 2009. "Models for sample selection bias in contingent valuation: Application to forest biodiversity," Journal of Forest Economics, Elsevier, vol. 15(1-2), pages 59-78, January.
    5. Mosi Rosenboim & Tal Shavit, 2012. "Whose money is it anyway? Using prepaid incentives in experimental economics to create a natural environment," Experimental Economics, Springer;Economic Science Association, vol. 15(1), pages 145-157, March.
    6. R. Naylor, 2001. "Industry profits and market size under bilateral oligopoly," Working Paper CRENoS 200108, Centre for North South Economic Research, University of Cagliari and Sassari, Sardinia.
    7. Rodrigo Abed & Haroon Sseguya & James Flock & Silvanus Mruma & Hamisi Mwango, 2020. "An Evolving Agricultural Extension Model for Lasting Impact: How Willing Are Tanzanian Farmers to Pay for Extension Services?," Sustainability, MDPI, vol. 12(20), pages 1-13, October.
    8. R. Naylor, 2001. "Firm profits and the number of firms under unionised oligopoly," Working Paper CRENoS 200109, Centre for North South Economic Research, University of Cagliari and Sassari, Sardinia.

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