Heterogeneous Preferences and Aggregation in Environmental Policy Analysis: A Landfill Siting Case

In many studies of nonmarket resources, economists have data to disaggregate results according to subpopulations within the full study population. Disaggregated results can increase the usefulness of economic analyses, improve public confidence in the results, and permit public officials to assess equity concerns. We outline an approach to obtain disaggregated results when characteristics of individuals may identify distinct preferences. The approach is applied to public preferences regarding landfill siting decisions. The discussion explores the implications of disaggregated results for policy decisions, for bias in aggregate willingness-to-pay estimates, and for nonmarket research methodologies.