• Environmental and Resource Economics Review
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• v.16 no.3
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• pp.701-721
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• 2007

A key issue in the development and application of stated preference nonmarket valuation is the incorporation of unobserved heterogeneity in utility models. Two approaches to this task have dominated. The first is to include individual-specific characteristics into the estimated indirect utility functions. These characteristics are usually socioeconomic or demographic variables. The second employs generalized models such as random parameter logit or probit models to allow model parameters to vary across individuals. This paper examines a third approach: the inclusion of psychological or 'latent' variables such as general attitudes and behaviour-specific attitudes to account for heterogeneity in models of stated preferences. Attitudinal indicators are used as explanatory variables and as segmentation criteria in a choice modelling application. Results show that both the model significance and parameter estimates are influenced by the inclusion of the latent variables, and that attitudinal variables are significant factors for WTP estimates.

• Environmental and Resource Economics Review
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• v.19 no.2
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• pp.303-340
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• 2010

The Demilitarized Zone (DMZ) of Korea has been crucial not only for its buffering role between two Koreas, but also for the conservation of various resources across its premises. The objectives of this study is threefold. The first objective is to identify major resources that determine economic values of the DMZ and its vicinity. The second and third objectives are respectively to estimate conservation values of those resources using Choice Modeling and to test whether or not respondents living in different geographical locations have significantly different willingness to pay for the conservation. In a very conservative estimation, results showed that Korean adults have about 55,000 Won on average for conserving five major resources : the DMZ area, endangered species, cultural heritage items and sites, the Truce Village, and villages in the Civilian Conroal Zone. This equals the aggregate economic value of about 2,07 trillion Won. Moreover, significant regional differences were found in public benefits from conserving these major resources.