Abstract 1 (Antons presentation)
RANDOM ERRORS IN RUM MODELS OF CVM DATA
Thomas Laitila1,2 and Anton Paulrud1
1Department of Forest Economics, SLU, 901 83 Umeå
2Department of Statistics, Umeå university, 901 87 Umeå
This paper considers the interpretation of random components in random utility models underlying applied analyses of CVM data. Variation in responses is explained as taste variation interpreted as variation in valuation of choice alternative characteristics. The approach suggested has several interesting features and implications. Models obtained through the random utility difference approach is derived as a special case. Also, the approach gives theoretical justification for direct modeling of the distribution of individual willingness to pay. An illustration of results are given within an empirical example concerning anglerís willingness to pay for increased catch rates.