Estimating demand schedules in hedonic analysis: the case of urban parks

Toke Emil Panduro; Cathrine Ulla Jensen; Thomas Lundhede; Kathrine  von Graevenitz; Bo Jellesmark Thorsen

Estimating demand schedules in hedonic analysis: the case of urban parks

Toke Emil Panduro, Cathrine Ulla Jensen, Thomas Lundhede, Kathrine von Graevenitz, Bo Jellesmark Thorsen

Section for Environment and Natural Resources

Abstract

The hedonic pricing method has been used extensively to obtain implicit prices for availability of urban green space, but few hedonic studies have obtained households’ preference parameters. We estimate willingness to pay functions for park availability in Copenhagen using an approach that places identifying restrictions on the utility function. We do this for two different measures of park availability. We apply our results to a policy scenario and show how estimates of aggregate welfare changes are highly sensitive to the measure of park availability applied. Thus, the approach in this study applies an alternative path for estimation of demand schedules for public goods using hedonic data. The findings also stress the importance of paying attention to how public goods are defined when undertaking welfare economic policy analyses.

Original language	English
Publisher	Department of Food and Resource Economics, University of Copenhagen
Number of pages	30
Publication status	Published - 2016

Series	IFRO Working Paper
Number	2016/06

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abstract = "The hedonic pricing method has been used extensively to obtain implicit prices for availability of urban green space, but few hedonic studies have obtained households{\textquoteright} preference parameters. We estimate willingness to pay functions for park availability in Copenhagen using an approach that places identifying restrictions on the utility function. We do this for two different measures of park availability. We apply our results to a policy scenario and show how estimates of aggregate welfare changes are highly sensitive to the measure of park availability applied. Thus, the approach in this study applies an alternative path for estimation of demand schedules for public goods using hedonic data. The findings also stress the importance of paying attention to how public goods are defined when undertaking welfare economic policy analyses. ",

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Estimating demand schedules in hedonic analysis: the case of urban parks

Abstract

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