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Understanding the WTA-WTP gap: Attitudes, feelings, uncertainty and personality

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  • Georgantzís, Nikolaos
  • Navarro-Martínez, Daniel

Abstract

We present an experiment designed to study the psychological basis for the willingness to accept (WTA)-willingness to pay (WTP) gap. Specifically, we conduct a standard WTA-WTP economic experiment to replicate the gap and include in it five additional instruments to try to follow the psychological processes producing it. These instruments are designed to measure five psychological constructs we consider especially relevant: (1) attitudes, (2) feelings, (3) familiarity with the target good, (4) risk attitudes, and (5) personality. Our results provide important new insights into the psychological foundations of the WTA-WTP disparity, which can be used to organize some major previous results and cast serious doubts on the claim that the gap might be just a consequence of inappropriate experimental practice.

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Bibliographic Info

Article provided by Elsevier in its journal Journal of Economic Psychology.

Volume (Year): 31 (2010)
Issue (Month): 6 (December)
Pages: 895-907

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Handle: RePEc:eee:joepsy:v:31:y:2010:i:6:p:895-907

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Web page: http://www.elsevier.com/locate/joep

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Keywords: Behavioural economics Choice behaviour Decision making;

References

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Cited by:
  1. Grebitus, Carola & Lusk, Jayson L. & Nayga, Rodolfo M., 2013. "Explaining differences in real and hypothetical experimental auctions and choice experiments with personality," Journal of Economic Psychology, Elsevier, vol. 36(C), pages 11-26.
  2. García-Gallego, Aurora & Georgantzís, Nikolaos & Jaramillo-Gutiérrez, Ainhoa, 2012. "Gender differences in ultimatum games: Despite rather than due to risk attitudes," Journal of Economic Behavior & Organization, Elsevier, vol. 83(1), pages 42-49.

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