An important focus for concern about Contingent Valuation (CV) is that hypothetical payments for non-market goods are biased upwards in comparison to cash payments. Lack of realism, through its influence on incentives to mis-report payments, may explain the divergence. This paper reports on a study which attempts to overcome this problem by emulating a real fund-raising solicitation by the Isle...

Random coefficient models such as mixed logit are increasingly being used to allow for random heterogeneity in willingness to pay (WTP) measures. In the most commonly used specifications, the distribution of WTP for an attribute is derived from the distribution of the ratio of individual coefficients. Since the cost coefficient enters the denominator, its distribution plays a major role in the ...

Finding the right pricing for music downloads is of ample importance to the recording industry and music download service providers. For the recently introduced music downloads, reference prices are still developing and to find a revenue maximizing pricing scheme is a challenging task. The most commonly used approach is to employ linear pricing (e.g., iTunes, musicload). Lately, subscription mo...

This study examines the determinants of farmers’ willingness to pay (WTP) and their payment levels for ecological compensation of the Poyang Lake Wetland in China. We developed a farmer household survey and gathered 292 effective responses. The contingent valuation method (CVM) and Heckman’s two-step model were employed for the empirical study. Results show that 46.58% of farmers are willing to...

The meteorological service (MS) in Korea is provided by the Korea Meteorological Administration (KMA), a governmental organization. This study attempts to measure the economic value of the national MS in the Korean household sector. Economic theory indicates that the economic value of a service is the area under the demand curve, which is the sum of the actual expenditure and the additional wil...

Nonmarket valuation research has produced economic value estimates for a variety of threatened, endangered, and rare species around the world. Although over 40 value estimates exist, it is often difficult to compare values from different studies due to variations in study design, implementation, and modeling specifications. We conducted a stated-preference choice experiment to estimate the valu...

Customer lifetime value (CLV) measurement is challenging as it requires forecasting customers' future purchases. Existing stochastic CLV models for this purpose generally make the following assumptions: 1) purchase behavior of customers can be described by purchase frequency and the average monetary value of transactions, 2) customers keep the same purchase behavior pattern over time, 3) purcha...

This article presents the results of an experiment designed to test theoretical predictions about the impact of public compensation schemes and ambiguity on insurance and self-insurance decisions. Consistent with theory, we find that government assistance significantly reduces willingness to pay (WTP) for insurance and self-insurance (compared with a free insurance market). As expected, we also...