ECONOMICS UNIQUENESS

ECONOMIC VALUATION OF CULTURAL HERITAGE ■ 95
buys essentially a non-separable bundle of goods. A related problem is that the
visitor to a cultural heritage good can derive utility from the trip itself or from
the company in which the journey occurs (social externalities). Secondly, the
opportunity costs of a visitor are hard to estimate; currently, the visitor’s wage
is oft en used to value the opportunity cost (Navrud and Ready 2002). Th irdly,
with travel cost methods, substitutes of cultural heritage can cause distortions
and create diffi culties to assess direct eff ects. Finally, when people who choose to
live in the vicinity of cultural heritage have a high preference for cultural assets,
the distance to the cultural heritage site itself is then a residential location factor,
which may cause complications in estimating the related demand function as the
basis for economic valuation.
Th e literature off ers various examples of cultural heritage studies that aim
to estimate the values of these assets by means of the travel cost method. Th ese
include the use of a site choice model to estimate the value of diff erent Dutch
museums (Boter et al. 2005) and the estimate of the consumer surplus of four
cultural heritage goods in the Castilla y Leon region in Spain on the basis of a
travel cost method (Bedate et al. 2004). Another study used methods that combine
the travel cost with contingent valuation carried out to value cultural heritage
in Armenia; this approach also off ers interesting opportunities to separate
use and non-use values (Alberini and Longo 2006). Th e approach of using travel
cost studies has gained momentum in applied evaluation studies, despite the
above-mentioned limitations.
Hedonic Price Method
Th e hedonic price method takes for granted that “goods are valued for their
utility-bearing attributes or characteristics” (Rosen 1974). Th is approach is
based on the idea that prices of heterogeneous goods stem from the characteristics
of attribute variety. Although Rosen’s original analyses were developed
for a market with perfect competition, the method is applicable under alternative
market conditions (Bajari and Benkard 2005; Rouwendal and van der
Straaten 2008). Clearly, hedonic price methods carry some intrinsic weaknesses.
For example, a study points out that the measurement of diff erent attributes of
the hedonic price method raises questions about the correct model specifi cation
(Jones and Dunse 1996).
In a later study, the same authors criticize the fact that the method reaches
an equilibrium state throughout the property market and no interrelationship
between the price of attributes is found (Dunse and Jones 1998). It is noteworthy
that hedonic price analysis, in principle, may contain many variables that
infl uence the value of real estate. In a conventional cross-section analysis, limited
information on potentially relevant characteristics implies the risk of omitted
variable bias. In addition, some other value determinants may be strongly