Conservation or deterioration in heritage sites? Estimating willingness to pay for preservation

TL;DR

This study estimates residents' willingness to pay for heritage site preservation in Shiraz, Iran, using a novel latent class model to account for heterogeneity and strategic voting, providing insights for heritage management policies.

Contribution

It introduces an innovative latent class binary logit model to accurately estimate willingness to pay, accounting for strategic voting and heterogeneity among respondents.

Findings

14% of respondents are unwilling to pay any levy.

Heritage site type influences willingness to pay.

Ignoring heterogeneity biases policy implications.

Abstract

A significant part of the United Nations World Heritage Sites (WHSs) is located in developing countries. These sites attract an increasing number of tourist and income to these countries. Unfortunately, many of these WHSs are in a poor condition due to climatic and environmental impacts; war and tourism pressure, requiring the urgent need for restoration and preservation (Tuan & Navrud, 2007). In this study, we characterise residents from Shiraz city (visitors and non-visitors) willingness to invest in the management of the heritage sites through models for the preservation of heritage and development of tourism as a local resource. The research looks at different categories of heritage sites within Shiraz city, Iran. The measurement instrument is a stated preference referendum task administered state-wide to a sample of 489 respondents, with the payment mechanism defined as a purpose-specific incremental levy of a fixed amount over a set period of years. A Latent Class Binary Logit model, using parametric constraints is used innovatively to deal with any strategic voting such as Yea-sayers and Nay-sayers, as well as revealing the latent heterogeneity among sample members. Results indicate that almost 14% of the sampled population is unwilling to be levied any amount (Nay-sayers) to preserve any heritage sites. Not recognizing the presence of nay-sayers in the data or recognizing them but eliminating them from the estimation will result in biased Willingness to Pay (WTP) results and, consequently, biased policy propositions by authorities. Moreover, it is found that the type of heritage site is a driver of WTP. The results from this study provide insights into the WTP of heritage site visitors and non-visitors with respect to avoiding the impacts of future erosion and destruction and contributing to heritage management and maintenance policies.