Assessing the economic value of a Assessing the economic value of a

world heritage site and willingness-world heritage site and willingness-

to-pay determinants: A case of to-pay determinants: A case of

Changdeok Palace Changdeok Palace

Presenter: Jenny Chen 陳瑩珍Instructor: Dr. Pi-Ying Teresa Hsu

March 16, 2009

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Kim, S. S., Wong, K. K. F. & Cho, M. (2007). Assessing

the economic value of a world heritage site and

willingness-to-pay determinants: A case of Changdeok

Palace. Tourism Management, 28, 317-322.

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ContentContent

I. Introduction

II. Methodology

III. Results

IV. Conclusion

V. Personal Reflection

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IntroductionIntroduction

United Nations Educational, Scientific and

Cultural Organization (UNESCO)

World Heritage List (http://whc.unesco.org/en/list)

- cultural assets

- natural assets

- mixture

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IntroductionIntroduction

1. Jeju Volcanic Island and Lava Tubes (2007)

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IntroductionIntroduction1. Haeinsa Temple Janggyeong Panjeon, the Depositories for

the Tripitaka Koreana Woodblocks (1995)

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IntroductionIntroduction2. Jongmyo Shrine (1995)

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IntroductionIntroduction3. Seokguram Grotto and Bulguksa Temple (1995)

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IntroductionIntroduction4. Hwaseong Fortress (1997)

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IntroductionIntroduction5. Gochang, Hwasun and Ganghwa Dolmen Sites (2000)

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IntroductionIntroduction6. Gyeongju Historic Areas (2000)

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Changdeok PalaceChangdeok Palace

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Centre of Seoul

Total area: 580,000m²

1405

Eco-friendly

Representative tourism attraction to foreign tourists

Entrance price: US$2.30/adultUS$1.20/youth or soldier

Changdeok PalaceChangdeok Palace

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IntroductionIntroduction

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IntroductionIntroduction

“Most of the past studies have attempted

valuation of cultural heritage goods by asking

residents their willingness-to-pay (WTP) for

taxes or donations.”

(Kim, Wong, & Cho, 2007)

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MethodologyMethodology

Contingent valuation method (CVM):

a survey-based economic technique for

the valuation of non-market resources

a sample of the relevant population is

asked to state their willingness-to-pay

(WTP)

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Research ObjectiveResearch Objective

- to investigate use value of the World

Cultural Heritage through the

contingent valuation method (CVM)

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Detailed information about touristic and

cultural value of Changdeok Palace

Close-ended/dichotomous choice

Price offers were divided into 10 categories

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QuestionnaireQuestionnaire

In return for using this traditional site would you

be willing to pay – more than present admission

prices :

(1) Yes, (2) No

Pre-test Participants 50 Korean adult visitors

Duration a week (Sept. 17, 2004- Sept. 24, 2004)

Main Survey Participants N/A

Duration two weeks (Oct. 17, 2005– Oct. 31, 2005)

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MethodologyMethodology

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MethodologyMethodology

log-linear log-logit

estimate the use value

identify and compare WTP determinants

Percentage

Gender Female Male

57.742.3

Age 20s 59.2

Residents in Seoul 59.5

Monthly household income $2000-3000 27.7

Profession student professional clerks others

32.020.016.032.0

Educational Level university graduate 52.5

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ResultsResults

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ResultsResults

ResultsResults

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ResultsResults

LIMDEP 8.0 program

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ResultsResults

Mean WTP Value(log-linear model)

5706 Won ($5.70)

Mean WTP Value(log-logit model)

6005 Won ($6.00)

Aggregate use value(log-linear model) 1.93 million dollars

Aggregate use value(log-logit model)

2.01 million dollars

Respondents are willing to pay at least

twice as much as the current price.

High level of WTP values alleviate the

worry of strategic behavior.

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ConclusionConclusion

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ConclusionConclusion

Restore old buildings

Undertake research

Renovate facilities or services

Interpret visitors

Promote the heritage site

Reinforce current or potential users’ beliefs in the importance of cultural assets

Personal ReflectionPersonal Reflection

Lack of demographic data of participants

Lack of statistical data

Mentioned consistency with other researches too often

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Thanks for your attention!

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