Analysing preference heterogeneity and willingness to pay for nature-based tourism activities in Gran Canaria for young Germans

Abstract

This paper examines the heterogeneity in preferences and willingness to pay for various nature-based tourism activities that can be carried out in natural areas on Gran Canaria Island (Spain). A discrete choice experiment is designed to obtain information about potential visitors' preferences in a set of hypothetical scenarios involving various activity packages created by combining the levels of the attributes according to an efficient design. Collected information is used to estimate a Mixed Logit model which will allow us to evaluate random and systematic heterogeneity in preferences. A key finding of the research emanates from obtaining individual-specific parameters to calculate not only the willingness to pay for the various activities but also the amount that could guide a potential compensation when undesired activities are included in the package. Results provide interesting managerial tools that can be used by tourism entrepreneurs to promote nature-based tourism products in the area.