Matching grants are commonly used to influence the bundle of public goods provided
by governments. A contingent valuation experiment was designed to determine the
value that individuals place on improved recreational facilities under a matching
grant proposal. The experiment provided an opportunity to examine preferences
given the public good exists in an active and well-defined market, and the valuation
experiment was perceived as meaningful to public policy. The researchers estimated
a mean willingness-to-pay for park improvements of $8.30, far less than the implied
tax increase of $21 provided by local politicians opposed to the project but nearly
double the actual tax increase for the average property owner.
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