Using Attitudinal Data to Identify Latent Classes that Vary in Their Preference for Landscape Preservation Forthcoming in Ecological Economics 2008 or 2009

The likelihood of significant heterogeneity in preferences for landscape preservation should be accounted for when designing WTP questions, estimating WTP, and formulating resulting policy recommendations. Herein, heterogeneity in preferences for landscape preservation is investigated in the context of a latent-class model under the assumption of the existence of some finite number of preference classes/groups. The number of classes is estimated, so few restrictions are placed on the form of the heterogeneity. One estimates the probability that individual i belongs to class c where these probabilities are a function of observable characteristics of the individual (covariates); this is much more flexible than assuming, for example, that all farmers have the same preferences. This paper aims to identify preference classes for landscape preservation in the IBLEO, a rural and beautiful part of Sicily. Estimation of classes is performed using only attitudinal data consisting of answers to Likert-scale questions about the importance of preservation and why the respondent thinks preservation is, or is not, important. Summarizing the results, estimation indicates four distinct preference classes. The classes vary in the level of importance attached to preservation and the motivation for preservation (e.g. use vs. non-use motivations), and include one group that has little interest in preservation. Key-words: landscape, latent class model, heterogeneity, preference