Heterogeneity and emotions in the valuation of non-use damages caused by oil spills

•The impact of a large oil spill in Spain on citizens' preferences is estimated.•Large levels of heterogeneity in citizens' perceptions and policy evaluation are found.•Emotions play a critical role in understanding individual perceptions of oil spill impacts.•Ignoring heterogeneous emotional reactions will likely bias contingent valuation results.•A new econometric model seems to improve stat fit and the understanding of citizens' perceptions.

Oil spills are capable of causing major environmental insults that raise the emotional loads of individuals across society. In this paper we consider the role of emotions in heterogeneous responses of individuals in the non-market valuation of an oil prevention program in Spain. Heterogeneity is modeled with a smoothly mixing regression (SMR) model that allows researchers to explain the probability that individuals belong to the latent segments of WTP. The results show that heterogeneity in WTP responses is explained by the specific emotional reactions of individuals (upset, sadness, indifference) rather than by their socioeconomic characteristics. Thus, the investigation of the emotional reactions of individuals can provide useful tools for the design of non-market valuation studies, providing more accurate predictions of the potential behavior of individuals in constructed markets for damage assessment.