In this study, we use data from an induced value choice experiment to compare estimates from mixed logit models in willingness to pay (WTP) space using different parameter distributional assumptions. Specifically, we test differences in WTP estimates when using flexible parameter mixing distributions (i.e. Legendre polynomials, step functions and splines) and conventional parameter distributions (normal and lognormal). Similar WTP estimates are obtained. However, we observe that WTP estimates are statistically different from the induced value when conventional distributions are assumed, but they are not when more flexible distributions are assumed. This suggests that flexible distributions can provide more reliable WTP estimates.
|Number of pages
|Australian Journal of Agricultural and Resource Economics
|Published - 2018 Apr
Bibliographical noteFunding Information:
*This work was partly supported by the Tyson Chair Endowment at the University of Arkansas and by the National Research Foundation of Korea (NRF-2014S1A3A2044459) and Research Council of Norway (Grant #233800). The authors want to thank Professor Christian A. Vossler, Professor Nicolas Jacquemet, Dr. Stephane Luchini and Dr. Verity Watson for their help suggestions in the design of the Induced Value Choice Experiment. Finally, the authors thank Professor Vincenzina Caputo, Diana Danforth and Professor Maurizio Canavari for their support in the experimental design.
© 2018 Australasian Agricultural and Resource Economics Society Inc.
- WTP space
- flexible mixing distribution
- induced value choice experiment
- normal distribution
ASJC Scopus subject areas
- Agricultural and Biological Sciences (miscellaneous)
- Economics and Econometrics