The theory underlying this work is the linear characteristics model (Gorman (1956), Lancaster (1966)). The idea is that people’s preferences are defined over the characteristics contained in different goods. They choose goods to give the combinations of characteristics they most prefer, out of those combinations which are available and affordable. This gives rise to a simple, linear pricing condition: the price a consumer is prepared to pay for a market good is equal to a weighted sum of their willingness-to-pay for the characteristics it contains (the weights are the amounts of characteristics). This is also known as an hedonic price function. We used this condition to estimate willingness- to-pay, which are often referred to as the shadow prices of characteristics.