Identification of Preferences in Hedonic Models. Volume 1 of Benefits Analysis Using Indirect or Imputed Market Methods

摘要

The purpose of the report is 'to solve the identification problem in hedonic models'. The volume describes the circumstances under which the problem is solved and analyzes other issues consistent with the use of the hedonic model in benefit-cost analysis. The identification problem concerns the difficulties researchers encounter in trying to find the household's schedule of willingness to pay for various levels of attributes of a house (e.g., size of rooms, neighborhood characteristics, environmental quality), not just a small change in the attribute. The identification problem stems from the fact that observed hedonic prices reflect not only on the value of the attribute to the household but also on the distribution of households of various types, the scarcity of houses, and the distribution of housing characteristics in the stock of housing. The conclusion of the volume is that while it is conceptually possible to identify the hedonic model, it is not a good use of research resources. Further research into how the housing market works, the accuracy of marginal prices, and other issues which logically precede the identification problem should be pursued.