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The success of ecolabelling to promote sustainable fisheries hinges on information. We explore the effects of spatially targeted knowledge on willingness to pay for ecolabels using treatments that provide consumers with knowledge about the health of worldwide, domestic, and foreign fisheries, which can have differential effects for domestic and imported seafood. Analysis of data collected using a choice experiment indicates that spatial differences in knowledge do not necessarily influence the value of ecolabels. Knowledge of the state of domestic fisheries has no greater effect on the value consumers assign to sustainable domestic products than knowledge of world fisheries. We also find that the ecolabels generate premiums and that importing discounted the value regardless of whether additional information on fisheries was provided and of the type of spatial knowledge provided. The greatest premium for ecolabelled domestic products was achieved when the world fishery information was provided, but additional knowledge about the fishery did not affect the value of ecolabelled foreign products. Additionally, consumers who received information on the domestic fishery and viewed it as positive were willing to pay as much for the labelled domestic products as those who received information on world fisheries. [ABSTRACT FROM AUTHOR]

Increased deployment of agricultural extension agents (EAs) in rural areas is recommended to spur agricultural productivity and mitigate spatial imbalances in welfare. However, high turnover and low motivation levels of EAs in remote areas pose challenges for equitable service provision and, in some cases, exacerbate geographical welfare disparities. We assess the effectiveness of selected potential policy interventions to incentivise and retain EAs in remote areas of Ethiopia. To this end, we conducted a choice experiment to elicit the preferences of 761 EAs for job attributes. We apply a random parameters logit model to estimate parameters of interest and to simulate the impact of possible policy interventions. Our results show that offering education opportunities is by far the most powerful instrument to attract and retain EAs. It increases uptake of the extension job in remote locations by 77 percentage points, which is significantly higher than the effect from doubling current salary levels. EAs also expressed a strong preference for work environments with basic amenities, housing, transportation services, and well‐equipped Farmer Training Centres (FTCs). Furthermore, the results from sub‐sample analyses show that female EAs are less responsive to pecuniary incentives and are more concerned with the availability of infrastructure and amenities. Current salary levels, years of employment, and location of work are also important sources of heterogeneity in the response of EAs to potential policy changes. [ABSTRACT FROM AUTHOR]

Coastal erosion is a complex and increasingly important problem, largely due to its effects and management strategies. The current context of climate change, together with centuries of human occupation of shorelines, adds pressure for the development of sustainable coastal management policies, the success of which crucially depends on the consideration of all stakeholders' perspectives. This research investigates users' preferences over alternative options of coastal erosion management. Through the implementation of a discrete choice experiment, respondents' preferences regarding management alternatives are elicited, and their willingness to pay for alternatives' attributes is estimated. The results show that respondents prefer some interventions to mitigate the problem rather than no action, and prefer lighter intervention (palisades, gangways) to heavy infrastructures (rockfills, seawalls, groynes). Moreover, the results show the presence of preference heterogeneity and thus the need to use more flexible and complex models. Based on the results obtained, it is possible to drive some policy implications. First, the do-nothing option is not viable from the population's standpoint; second, although some type of coastal erosion protection is demanded by the general population, the preferred approach is for light forms, contrary to the policy adopted in the last century, and still overwhelmingly present in the territory. Lastly, given the considerable heterogeneity in respondents' preferences, careful consideration of the welfare impact of coastal interventions by population segments is required. [ABSTRACT FROM AUTHOR]

The impact of the approach used to describe preference heterogeneity on welfare measures has been widely studied by the academic community. However, the question as to the degree of error in welfare estimation from an inappropriate choice of empirical approach has not been addressed yet. In this paper, we use Monte Carlo analysis to investigate this issue. Our overall conclusion is that, when analysts have difficulties in choosing the best approach relying on available statistical tests, smaller errors in welfare measures are likely to come from use of a latent class model.

Abstract Thailand has become one of the biggest exporters of agricultural products and the majority of the poor households rely on agriculture as their main source of income. Recent droughts and flooding have affected the agricultural farms especially in the upland areas of northern Thailand. Incentive based policies can play an important role in conservation and protection of agroecosystems. Hence, this paper applies a Choice Experiment approach to elicit small scale farmers' preferences for a potential payment policy scheme. Latent class models were used to analyse the farmers' responses to investigate their preferences, heterogeneity in preferences and the willingness to accept compensations. The results reveal that farmers are willing to participate in the proposed payment for ecosystem services (PES) scheme; however, overall the farmers show an aversion to drastic changes in their farming activities. The analysis suggests that majority of the farmers prefer schemes which require moderate reduction in chemical use and have shorter contract lengths. Furthermore, the study also provides cost comparisons of various policy combinations and variation in spatial patterns of the welfare estimates, which are useful for identifying the target areas for effective implementation of policy schemes. [ABSTRACT FROM AUTHOR]

Highlights • Integrated approach to ecosystem services valuation is presented. • Ecological, social, and economic valuations are integrated in process and results. • Application of multiple methods ensures engagement of multiple stakeholders. • Approach explains different perspectives on importance of ecosystem services. • Four typified perspectives are discovered and explored. Abstract An integrated approach to understanding ecosystem service values in Wyoming and Montana, USA is presented. The assessment encompasses a major river basin, and includes a synthesis of existing data and research related to the natural system and separate data collection efforts regarding the social and economic importance of ecosystem services. A holistic look at the social-ecological system provides nuanced information about ecosystem service values and tradeoffs for the purpose of public land decision-making. The initial ecological assessment concluded that water resources were particularly vulnerable, which guided the social and economic assessments. The social assessment applied Q-methodology, ultimately identifying and exploring four archetypes regarding views on the importance of 34 ecosystem services, which were dubbed "environmental", "agricultural", "Native American", and "recreation". The economic assessment applied choice modeling to understand non-market values of ecosystem services (i.e., agricultural community, aquatic biodiversity, river angling, and motorized winter recreation), and latent class analysis provided insight into preference heterogeneity previously indicated in the social assessment. The structured approach can inform natural resource decision-making by including several different perspectives, integrating multiple spatial scales, highlighting particular ecosystem services as relevant within the context of many ecosystem services, and facilitating relations between the public and natural resource stewards. [ABSTRACT FROM AUTHOR]

In this article we utilize the time respondents require to answer a self-administered online stated preference survey. While the effects of response time have been previously explored, this article proposes a different approach that explicitly recognizes the highly equivocal relationship between response time and respondents' choices. In particular, we attempt to disentangle preference, variance and processing heterogeneity and explore whether response time helps to explain these three types of heterogeneity. For this, we divide the data (ordered by response time) into approximately equal-sized subsets, and then derive different class membership probabilities for each subset. We estimate a large number of candidate models and subsequently conduct a frequentist-based model averaging approach using information criteria to derive weights of evidence for each model. Our findings show a clear link between response time and utility coefficients, error variance and processing strategies. Our results thus emphasize the importance of considering response time when modeling stated choice data. [ABSTRACT FROM AUTHOR]

Because edible insects provide nutritional and environmental benefits, there is a focus on establishing and optimizing the insect production sector and developing the value chain. However, little is known about consumers’ reactions to insects as food. This paper provides a first insight into consumers’ preferences for termite-based food products (TBFPs) using data from a choice experiment survey in Kenya. A novel feature of this paper is that it investigates the combined effects of product-related and contextual attributes, as well as consumer attitudes on preferences for TBFPs. In addition, the paper focuses on the extent to which preferences may be affected depending on the meal formats, i.e. whether the termites are introduced either as whole insects or as a processed component in a typical daily meal. The results suggest that consumers prefer TBFPs with high nutritional value and especially when they are recommended by officials. Results further indicate that affirmative recommendations are particularly important for the processed TBFP, and consumers prefer to buy this type of product in kiosks or supermarkets than at local marketplaces. Despite a considerable degree of preference heterogeneity, most consumers react positively to whole as well as processed termites. Therefore, the introduction of TBFPs is likely to succeed regardless of whether the termites are processed or not, although introducing the processed product may require further information and quality assurances to alleviate perceived food risks. [ABSTRACT FROM AUTHOR]

A choice experiment is used to evaluate how consumers in London, Frankfurt, and Paris value beef steaks with attributes such as: "hormone-free," "GM-free," farm-specific source verification, and domestic origin. The effect of various consumer characteristics on steak selection is also evaluated. Results suggest that European consumers are significantly heterogeneous in their preferences for beef steak attributes. French and German consumers have a higher willingness to pay to avoid genetically modified feed use than British consumers, while German and British consumers would pay more for growth hormone-free beef. French and German consumers are willing to pay for farm-specific source verification.

Unobserved heterogeneity of error scale in choice models is a recent extension of the better investigated issue of heterogeneity of taste intensity. It is achieved by fitting choice panel data with specifications that simultaneously handle inter-personal variation in scale and taste. The aim is to separate differences in preference intensities across respondents from differences in the degree of consistency in choice behaviour, or 'preference discrimination', while accounting for correlation between the two. Another recent substantive issue in choice data analysis is attribute non-attendance. We develop a finite mixing model to address simultaneously the three issues above. We empirically prove the concept on stated preference data related to tap water attributes in a study for industry regulation. [ABSTRACT FROM AUTHOR]

Highlights: [•] We use a latent class model to examine preferences for functional dairy products. [•] The combined use of attitudinal and socioeconomic data in a choice experiment. [•] Existence of class-specific preference heterogeneity. [•] All consumers place high value on dairy products enriched with omega-3 fatty acids. [•] Different consumers reveal differing preferences for the same set of health claims. [ABSTRACT FROM AUTHOR]

There is increasing evidence that respondents to choice experiment surveys do not consider all attributes presented in the choice sets. Not accounting for this 'attribute non-attendance' leads to biased parameter estimates, and hence biased estimates of willingness to pay. Various methods exist to account for non-attendance in the analysis of choice data, with limited agreement as to which method is 'best'. This paper compares modelling approaches that can account for non-attendance, based on stated and inferred attribute non-attendance. Respondents' stated non-attendance is incorporated in the specification of multinomial and mixed logit models. Inference of non-attendance is based on equality constrained latent class models. Results show that model fit is significantly improved when attribute non-attendance is taken into account, and that welfare estimates are lower when incorporating non-attendance. The inference based on equality constrained latent class models provides the best model fit. There is little concordance between stated and inferred non-attendance, suggesting that respondents may not answer attendance statements truthfully. [ABSTRACT FROM AUTHOR]

Farmland can confer significant public good benefits to society aside from its role in agricultural production. In this article, we investigate preferences of rural residents for the use of farmland as a recreational resource. In particular, we use a choice experiment to determine preferences for the development of farmland walking trails. Our modelling approach uses a series of mixed logit models to assess the impact of alternative distributional assumptions for the cost coefficient on the welfare estimates associated with the provision of the trails. Our results reveal that using a mixture of discrete and continuous distributions to represent cost heterogeneity leads to a better model fit and lower welfare estimates. Our results further reveal that Irish rural residents show positive preferences for the development of farmland walking trails in the Irish countryside. [ABSTRACT FROM AUTHOR]

Different economic valuation methodologies can be used to value the non-market benefits of an agri-environmental scheme. In particular, the non-market value can be examined by assessing the public's willingness to pay for the policy outputs as a whole or by modelling the preferences of society for the component attributes of the rural landscape that result from the implementation of the policy. In this article we examine whether the welfare values estimated for an agri-environmental policy are significantly different between an holistic valuation methodology (using contingent valuation) and an attribute-based valuation methodology (choice experiment). It is argued that the valuation methodology chosen should be based on whether or not the overall objective is the valuation of the agri-environment policy package in its entirety or the valuation of each of the policy's distinct environmental outputs. [ABSTRACT FROM AUTHOR]

Choice experiments (CE) have become widespread as an approach to environmental valuation in both Australia and overseas. However, there are few valuation studies that have addressed natural resource management (NRM) changes in Tasmania. Furthermore, few studies have focussed on the estimation of estuary values. The CE study described in this paper aims to analyse community preferences for NRM options in the George catchment, Tasmania. Catchment health attributes were: the length of native riverside vegetation; the number of rare native animal and plant species in the George catchment; and area of healthy seagrass beds in the Georges Bay, which was used as a measure of estuary condition. Mixed logit models with interactions between socio-economic variables and the choice attributes were estimated to account for systematic and random taste heterogeneity across respondents. Results reveal considerable variation in preferences towards the attributes and show that value estimates are significantly impacted by the way in which we account for preference heterogeneity. Preference heterogeneity thus needs to be considered when estimating community willingness-to-pay for environmental changes. This study further shows little responsiveness to the presented changes in estuary seagrass area. [ABSTRACT FROM AUTHOR]

The mixed or heterogeneous multinomial logit (MIXL) model has become popular in a number of fields, especially marketing, health economics, and industrial organization. In most applications of the model, the vector of consumer utility weights on product attributes is assumed to have a multivariate normal (MVN) distribution in the population. Thus, some consumers care more about some attributes than others, and the IIA property of multinomial logit (MNL) is avoided (i.e., segments of consumers will tend to switch among the subset of brands that possess their most valued attributes). The MIXL model is also appealing because it is relatively easy to estimate. Recently, however, some researchers have argued that the MVN is a poor choice for modelling taste heterogeneity. They argue that much of the heterogeneity in attribute weights is accounted for by a pure scale effect (i.e., across consumers, all attribute weights are scaled up or down in tandem). This implies that choice behaviour is simply more random for some consumers than others (i.e., holding attribute coefficients fixed, the scale of their error term is greater). This leads to a "scale heterogeneity" MNL model (S-MNL). Here, we develop a generalized multinomial logit model (G-MNL) that nests S-MNL and MIXL. By estimating the S-MNL, MIXL, and G-MNL models on 10 data sets, we provide evidence on their relative performance. We find that models that account for scale heterogeneity (i.e., G-MNL or S-MNL) are preferred to MIXL by the Bayes and consistent Akaike information criteria in all 10 data sets. Accounting for scale heterogeneity enables one to account for "extreme" consumers who exhibit nearly lexicographic preferences, as well as consumers who exhibit very "random" behaviour (in a sense we formalize below). [ABSTRACT FROM AUTHOR]

The latest trends in tourism indicate the emergence of a new segment of visitors looking for accommodation in private residences. The increase in second-home residents has led to efforts to improve knowledge of the preferences of this new type of tourist in those destinations where their presence is considerable. As one of the key variables affecting the choice of residential tourists is the environmental quality of the area, this paper focuses on testing for the existence of an inverse correlation between the loss of coastal water transparency, viewed as a measure of environmental quality, and beach aesthetics in Santa Ponga Bay, a Mallorcan coastal area containing two urban beach zones of intensive recreational use, where the proportion of second-home residents is high. The results show that the willingness to pay for improvements in water transparency diminishes in a non-linear way when transparency deteriorates, resulting in no statistically significant differences between first- and second-home residents. [ABSTRACT FROM AUTHOR]

Stated choice models based on the random utility framework are becoming increasingly popular in the applied economics literature. The need to account for respondents’ preference heterogeneity in such models has motivated researchers in agricultural, environmental, health, and transport economics to apply random parameter logit and latent class models. In most of the published literature these models incorporate heterogeneity in preferences through the systematic component of utility. An alternative approach is to investigate heterogeneity through the random component of utility, and covariance heterogeneity models are one means of doing this. In this article we compare these alternative ways of incorporating preference heterogeneity in stated choice models and evaluate the sensitivity of estimated welfare measures to which approach is selected. We find that a latent class approach fits our data best, but all the models perform well in terms of out-of-sample predictions. Finally, we discuss what criteria a researcher can use to decide which approach is most appropriate for a given data set. [ABSTRACT FROM AUTHOR]

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This study employs mixed logit and latent class models to examine preferences for cattle traits with a focus on heterogeneity among cattle keepers, using choice experiment data of 506 cattle-keeping households in Kenya and Ethiopia. The findings indicate the existence of preference heterogeneity based on cattle production systems. Highly valued cattle traits for the cropping systems include traction fitness and trypanotolerance, while traits associated with herd increase are considered important in pastoral systems. Considering heterogeneity within population segments provides a framework for adapting breeding policy interventions to specific producer segments, by integrating preferred traits in a breed improvement program. [ABSTRACT FROM AUTHOR]

This paper undertakes a detailed market segmentation analysis of the demand for GM derived animal foods in the UK with the aim of illustrating how this analysis can provide distinct information that can assists in evaluating the welfare impacts of proposed changes to the EU's GM labelling policy. The specific modelling approach employed was the latent segment (LS) model which allows for the simultaneous determination and explanation of both segment membership and product choice. Based on psychometric and demographic variables as well as choice data, the LS model was able to identify three distinct and behaviourally consistent consumer segments. Further, the LS model was found to outperform alternative econometric approaches for accounting for preference heterogeneity. Finally, our analysis shows how it can yield distinct information over the segmented nature of the food market that can uniquely assist both European policy makers in designing GM labelling regimes and public awareness campaigns as well as the agricultural and food industry in developing pricing, marketing and new product development strategies. [ABSTRACT FROM AUTHOR]

A finite mixture approach to conditional logit models is developed in which latent classes are used to promote understanding of systematic heterogeneity. The model is applied to wilderness recreation in which a branded choice experiment involving choice of one park from a demand system was administered to a sample of recreationists. The basis of membership in the classes or segments in the sample involved attitudinal measures of motivations for taking a trip, as well as their stated preferences over wilderness park attributes. The econometric analysis suggested that four classes of people exist in the sample. Using the model to examine welfare measures of some hypothetical policy changes identified markedly different welfare effects than the standard single segment model, and provided insight into the differential impact of alternative policies. [ABSTRACT FROM AUTHOR]

This paper presents an application of a choice experiment measuring public preferences for a farmland retirement project (FRP) in the Gansu environmental degraded region of China. The project helps improve China’s long-term food security, and information on public preferences can be used to cost-effectively design such policies. FRP is conceptualized with four attributes relating to public preferences: Areas enrolled in the program, duration of the contract, priority zone for conservation, and vegetation type for planting. The analysis employs a mixed logit model, allowing for preference heterogeneity, and explores the differences between the willingness to pay of urban and rural residents. Results identify substantial benefits for FRP, and these benefits are closely linked to the program design. Results also show that the willingness to pay for a longer period of the program of urban residents is significantly higher than that of rural residents. Finally, this study proposes policy recommendations that the number of areas and years of the current FRP in the study area can be increased moderately, but not excessively, to further benefit local residents. [ABSTRACT FROM AUTHOR]