 Semiparametric Estimation of Willingness to Pay DistributionsNo 96-20, Working Papers from Duke University, Department of Economics Abstract: The most popular survey method used in contingent valuations asks "open-ended" dichotomous choice questions. This method generates grouped or interval-censored data on respondents' willingness to pay. This paper specifies the willingness to pay distribution using the proportional hazard specification in duration analysis. This semiparametric distribution, on the one hand, controls for the effects of observed personal characteristics, and on the other, allows the shape of the distribution to be unspecified. To estimate the willingness to pay distribution from grouped data, we propose both a maximum likelihood estimation method and a minimum Chi-square method. The latter procedure applies to "many observations per cell" cases where the observable covariates are either categorical or amendable to sensible grouping. Specification tests for the proportionality assumption are proposed. The statistical inference procedures are illustrated using the data set from the San Joaquin Valley contingent valuation survey. JEL-codes: C14 C25 Q20 (search for similar items in EconPapers) Downloads: (external link) Related works: Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text Persistent link: https://EconPapers.repec.org/RePEc:duk:dukeec:96-20 Access Statistics for this paper More papers in Working Papers from Duke University, Department of Economics Department of Economics Duke University 213 Social Sciences Building Box 90097 Durham, NC 27708-0097. |
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