Estimating the Public Good Value of Preserving a Local Historical Landmark

November, 2001


This study applies the contingent valuation method to estimate the public good values of preservation and restoration of a local historic landmark in a medium-sized U.S. city. The survey device centers on a referendum-style dichotomous-choice question regarding city participation in a restoration partnership. Use of a double-split sample allows analysis of the effect on valuation of (1) heritage information and (2) willingness-to-pay versus willingness-toaccept constructs, where the latter is approached by the method of paired comparison, allowing a nonsubstitutability effect to be separated from any endowment effect. Econometric analysis using a standard binary logit model indicates the existence of a strong nonsubstitutability effect, and a significant information effect that further suggests the importance of nonsubstitutability in valuation.

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