Application of Sample Selection Model to Double-Bounded Dichotomous Choice Contingent Valuation Studies

Seung-Hoon Yoo () and Hee-Jong Yang

Environmental & Resource Economics, 2001, vol. 20, issue 2, 147-163

Abstract: Modeling households' behavior with the data from a contingentvaluation (CV) survey is often complicated by samplenon-response, which can cause non-response bias and sampleselection bias, leading to inconsistent parameter estimates and adistorted mean willingness-to-pay estimate. This paper reportsthe results of empirical tests for both biases using householdsurvey data in which the double-bounded dichotomous choice CVquestion involved the benefit of a tap water quality improvementpolicy in Korea. No non-response bias, but sample selection bias,is detected in the sample. To correct for sample selection bias,a sample selection model is employed. The authors also discusshow failure to correct for bias may distort aggregate benefitestimates. Copyright Kluwer Academic Publishers 2001

Keywords: contingent valuation; non-response; sample selection bias; tap water quality (search for similar items in EconPapers)
Date: 2001
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Citations: View citations in EconPapers (20)

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DOI: 10.1023/A:1012625929384

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