SPIKE

Description

spike allows for a non-zero probability of zero willingness-to-pay in referendum-style contingent valuation experiments. When large segments of a population decline to consume the offered good, traditional parametric approaches based on probit and logit models tend to predict unrealistic negative WTP values. The spike model methodology, based on Kriström (1997), provides a solution by explicitly modeling the mass point at zero.

Example

* Spike model for zero willingness-to-pay
spike s t bid

References

• Kriström, B. (1997). “Spike Models in Contingent Valuation.” American Journal of Agricultural Economics, 79(3), 1013–1023.

Citation

Azevedo, J.P. (2010). “SPIKE: Stata module for the estimation of zero willingness-to-pay.” Statistical Software Components S457126, Boston College Department of Economics.