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Selected Works of Arthur J. Caplan
Article
Measuring Heterogeneous Preferences for Residential Amenities
Regional Science and Urban Economics (2021)
  • Arthur J Caplan, Utah State University
  • Sherzod B. Akhundjanov, Utah State University
  • Kristopher Toll, Imagine Learning
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Abstract
This study reports on estimates of heterogeneous preferences for residential amenities
among households in the Mountain West region of the US. The estimates are derived
from a choice experiment funded by the Utah Department of Transportation and Utah
Transit Authority—an experiment based upon large samples of both homeowners and
renters who participated in a larger, statewide transportation study. The choice ex-
periment and transportation study allow us to control for a rich set of household-level
demographic and lifestyle characteristics, which in turn permits identification of a
host of factors contributing to heterogeneity in residential preferences. We leverage a
percentage-change housing cost attribute included in the experiment to obtain mea-
sures of marginal willingness to pay (MWTP) for the various residential attributes and
attribute levels in our study. Our method of converting the percentage-change cost
attribute to dollar-denominated MWTP results in theoretically plausible estimates of
a household’s MWTP. We find that preferences for residential amenities differ across
homeowners and renters with respect to intensity rather than direction—homeowners
are generally willing to pay more for these amenities, in some cases up to seven times
more. Our quantitative estimates of these preferences and the extent to which we
control for heterogeneity across households provide urban and regional planners with
precise monetary welfare measures for a sizable majority of the region’s residents.
Keywords
  • Residential preferences,
  • Choice experiment,
  • Marginal willingness to pay
Disciplines
Publication Date
March, 2021
DOI
https://doi.org/10.1016/j.regsciurbeco.2021.103646
Citation Information
Arthur J Caplan, Sherzod B. Akhundjanov and Kristopher Toll. "Measuring Heterogeneous Preferences for Residential Amenities" Regional Science and Urban Economics Vol. 87 (2021)
Available at: http://works.bepress.com/arthur_caplan/136/