A Multivariate Probit Analysis of Willingness to Pay for Cave Conservation: A Case Study of Yanchep National Park, Western Australia

Abstract

This study employed the double-bounded dichotomous choice contingent valuation technique along with factor analysis to estimate visitors' willingness to pay (WTP) for the Yanchep Caves Recovery Project (YCRP). Two payment vehicles were used to elicit WTP: park entry fee and cave entry fee. The main contribution of this paper is the joint estimation of the two payment vehicles using the multivariate probit model by allowing the error terms of the two models to be correlated. Emphasis was given to testing whether parameters of the two bid levels should be constrained and to overcoming anchoring bias. The estimated median WTP for cave and park entry fees when accounting for anchoring effect and constrained parameters was AU$10.20 and AU$16.40, respectively. Without correcting for the anchoring effect, the WTP probability is overestimated for lower bids and underestimated for higher bids.