Incorporating Outcome Uncertainty and Prior Outcome Beliefs in Stated Preferences

The impact of latent risk preferences on valuing the preservation of threatened lynx populations in Poland

“…Nevertheless, the outstanding feature of the HLCM in our study is the link of the stated WTP to the socio-demographic variables not found in the plain LCM. That the marginal WTP estimates found in the LV model do not significantly differ from those derived from a rather standard modelling approach is also reported by Lundhede et al (2015). They furthermore support our finding that the LV model gives valuable insights into the patterns underlying the stated choices.…”

“…Finally, the application of the LV approach is still new to environmental valuation, especially regarding uncertainties of conservation policies. In line with the study by Lundhede et al (2015), the results indicate that these models give richer insights into what determines choice among the offered alternatives. To what extent this finding can be generalised has to be answered by future studies.…”

“…They furthermore support our finding that the LV model gives valuable insights into the patterns underlying the stated choices. Regarding the provided insight, it is noteworthy that Lundhede et al (2015) also found a significant influence of age on the LV and subsequently on a lower WTP of older people.…”

“…Applications in environmental valuation, for example, have been presented by Hess and Beharry-Borg (2012), Hoyos et al (2015) or Mariel et al (2015). Moreover, a recent study that is close to the subject of the present paper uses a LV to incorporate prior outcome beliefs in a stated choice model concerned with investigating how outcome uncertainty affects stated WTP (Lundhede et al 2015). The authors find that respondent's prior beliefs significantly influence the estimated utility of outcome uncertainty and that the LV model gives valuable insight into the patterns underlying concepts of belief in policy outcome and how they influence the stated WTP for conservation measures.…”

Should we pay, and to whom, for biodiversity enhancement in private forests? An empirical study of attitudes towards payments for forest ecosystem services in Poland

“…Recent studies, however, demonstrate that employment of HCMs often does not lead to results significantly different from those of the standard MNL models. For example, Kløjgaard and Hess (2014) as well as Lundhede et al (2015) show that willingness to pay estimates do not change significantly when HCM models are used to account for endogeneity. Chorus and Kroesen (2014) point out that, as compared to conventional choice models, the value added by HCMs is often rather limited.…”