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    Choice modelling techniques

    Suitability for the forest ecosystem services to be valued:
    All forest services
    Description of the method:
    Choice modelling attempts to determine the willingness to pay (WTP) of an individual by analysing his choices between different alternatives. Individuals are faced with two or more alternatives with shared attributes of the services to be valued, but with different attribute levels (one of the attributes being the money people would have to pay for the service). The alternatives are designed so that the respondent’s choice reveals the marginal rate of substitution between the attributes and the item that is traded off (e.g. money). The basic premise of the choice experiment is that a forest good or service can be decomposed in a bundle of attributes or features, and that individuals are sensitive to changes in these attributes.
    The most used variants of choice modelling techniques are Contingent ranking, Contingent rating, Pair comparisons, and Discrete choice.
    Benefits of the method:
    Measurement of non-use values possible (to provide a true measure of total economic value)
    Valuation of future goods and services possible
    Valuation of several goods/services at the same time (including their trade-offs)
    The use of surveys allows to collect relevant socioeconomic and attitudinal data on the respondents that could be relevant for understanding the variables influencing social preferences and choices
    The use of surveys allows to estimate hypothetical changes and their impact before they have taken place
    Participative/deliberative approaches before valuing the good or service at stake seem to provide with more stable results
    Limitations of the method:
    High data requirements
    Analysis mathematically complicated
    Interpretation not straightforward for lay people
    Preferences for non-use values tend to be less stable
    Budget and time demands are high
    High risk of biases that may lead to inaccurate WTP estimations

    Case examples: