Substitution Effects and Spatial Preference Heterogeneity in Single- and Multiple-Site Choice Experiments

A novel discrete choice experiment (DCE) design allows testing of substitution effects based on the framing of, and distances to, substitute sites. The same ecosystem services and biodiversity provided at different sites are valued independently in single-site DCEs and simultaneously in a multiple-site DCE, using an identical experimental design. Site-specific utility functions are estimated with and without controlling for spatial preference heterogeneity. Framing choices as alternative projects at single or multiple sites significantly influences substitutability between sites, choice behavior, and welfare estimates. Distance decay displays significant heterogeneity in different directions from the valued sites and between urban and rural areas. (JEL Q51)

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