Contingent Valuation Using Dichotomous Choice Models

Abstract

This paper demonstrates a new use of Logit models in recreation research beyond analysis of recreation participation/site choice: use in valuation of recreation benefits. The use of logistic regression allows a more market like Contingent Valuation survey question in which each recreationist is asked if they would continue to visit the site at a specified price, which varies by respondent. A numerical example is provided which demonstrates how inferences about recreationist's maximum willingness to pay can be made from their yes or no responses. The paper concludes with a discussion of the relative merits of performing Contingent Valuation surveys based on the logit model.

KEYWORDS:

• Recreation benefits
• logit models
• Contingent Valuation
• willingness to pay