Non-Market Goods - Revealed Preferences - Hedonic Pricing Method
Methodology -
Lake State Examples -
Other Examples
Back to Table of Contents
Methodology:
Lake States
Examples: Monty, B. and M.
Skidmore. 2003. "Hedonic Pricing and Willingness to Pay for Bed and Breakfast
Amenities in Southeast Wisconsin." Journal of Travel Research 42(2):195-199.
This study is of the first to apply the technique of hedonic pricing to the
tourism industry. The hedonic pricing model treats goods and services as
providing a collection of characteristics and can be applied to a market for
any differentiated product or service. Using data from bed and breakfast in
Walworth County, Wisconsin the hedonic pricing model is used to reveal the
willingness to pay for different amenities. While location is the largest
determinant of price, some amenities are important determinants of willingness
to pay. For example, a hot tub may add as much as $30 one is able to charge
for a room in a bed and breakfast. Other important determinants include size
of room and private bathroom.