Hedonic Price Analysis and Selectivity Bias

Phoebe Koundouri () and Panos Pashardes ()

Environmental & Resource Economics, 2003, vol. 26, issue 1, pages 45-56

Abstract: Hedonic valuation of quality attributes can be misleading when theassumption that these attributes are exogenous to sample selection isviolated. This paper considers the simultaneity between hedonic valuationand sample selection in the context of a model of producer behavior andinvestigates empirically the case where land is demanded for use as an inputeither in agricultural production or in touristic development. The empiricalanalysis suggests that failing to correct for sample selection results in abiased valuation of the effect of water salinity on agricultural land. Copyright Kluwer Academic Publishers 2003

Keywords: quality; resource environmental valuation; sample selection bias; separability (search for similar items in EconPapers)
Date: 2003
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