Estimating WTP for Speed Reduction from Dichotomous-Choice CV Responses with Follow-up: The Case of Rural Trunk Roads

We present an empirical estimation of the distribution of WTP for effective speed restriction via implementation of local traffic calming schemes. Random samples are drawn from the populations of households of three centres intersected by main trunk roads with varying through traffic conditions. We retrieve the underlying WTP distributions from discrete-choice responses to site-specific referendum contingent valuation studies accounting for zero-bidders. We then test the hypothesis of different distributions across villages. The statistical analysis is first conducted by means of a parametric specification and then by a totally non-parametric one. Stated welfare changes for effective speed reduction are found to be sizeable and the parameters of the random utility models are plausibly related to differences in objective speed measures across centres. The results appear to encourage the use of the referendum-CV method in the estimation of local public goods.