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Embedding and calibration in measuring non-use values

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  • Schulze, William D.
  • McClelland, Gary H.
  • Lazo, Jeffrey K.
  • Rowe, Robert D.
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    Abstract

    Embedding, the notion that respondents to contingent valuation (CV) questions often value more than the researcher intends, has engendered extreme views. These range from the suggestion that embedding is so severe that it renders CV useless to the assertion that embedding can be eliminated by providing sufficient information in a survey. This paper examines three alternative explanations for embedding: 1) the purchase of moral satisfaction, 2) independent valuation and summation, and 3) mental models of joint products. Several studies that shed light on the nature of the embedding problem are presented and we examine whether it is possible to test for embedding through follow up questions that obtain self reports from respondents. We show that answers to these debriefing questions predict whether or not different groups of respondents pass a scope test (i.e., a statistically significant difference between groups valuing different levels of the same commodity). We reject the view that increased market context can solve the embedding problem. Rather, embedding may depend on the nature of the commodity itself.

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    Bibliographic Info

    Article provided by Elsevier in its journal Resource and Energy Economics.

    Volume (Year): 20 (1998)
    Issue (Month): 2 (June)
    Pages: 163-178

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    Handle: RePEc:eee:resene:v:20:y:1998:i:2:p:163-178

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    Web page: http://www.elsevier.com/locate/inca/505569

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    References

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    1. Hoehn, John P & Randall, Alan, 1989. "Too Many Proposals Pass the Benefit Cost Test," American Economic Review, American Economic Association, vol. 79(3), pages 544-51, June.
    2. Kahneman, Daniel & Knetsch, Jack L., 1992. "Valuing public goods: The purchase of moral satisfaction," Journal of Environmental Economics and Management, Elsevier, vol. 22(1), pages 57-70, January.
    3. Peter A. Diamond & Jerry A. Hausman, 1994. "Contingent Valuation: Is Some Number Better than No Number?," Journal of Economic Perspectives, American Economic Association, vol. 8(4), pages 45-64, Fall.
    4. Fischhoff, Baruch & Furby, Lita, 1988. " Measuring Values: A Conceptual Framework for Interpreting Transactions with Special Reference to Contingent Valuation of Visibility," Journal of Risk and Uncertainty, Springer, vol. 1(2), pages 147-84, June.
    5. Brookshire, David S, et al, 1982. "Valuing Public Goods: A Comparison of Survey and Hedonic Approaches," American Economic Review, American Economic Association, vol. 72(1), pages 165-77, March.
    6. Brown, G. & Layton, D. & Lazo, J., 1994. "Valuing Habitat and Endangered Species," Working Papers 94-1, University of Washington, Department of Economics.
    7. Douglas D. Davis & Charles A. Holt, 1992. "Introduction to Experimental Economics," Introductory Chapters, in: Experimental Economics Princeton University Press.
    8. Brown, G. & Layton, D. & Lazo, J., 1994. "Valuing Habitat and Endangered Species," Discussion Papers in Economics at the University of Washington 94-1, Department of Economics at the University of Washington.
    9. Carson Richard T. & Mitchell Robert Cameron, 1995. "Sequencing and Nesting in Contingent Valuation Surveys," Journal of Environmental Economics and Management, Elsevier, vol. 28(2), pages 155-173, March.
    10. Carson, R.T. & Mitchell, R.C. & Hanemann, W.M. & Kopp, R.J. & Presser, S. & Ruud, P.A., 1992. "A Contingent Valuation Study of Lost Passive Use Values Resulting From the Exxon Valdez Oil Spill," MPRA Paper 6984, University Library of Munich, Germany.
    11. Harrison, Glenn W., 1992. "Valuing public goods with the contingent valuation method: A critique of kahneman and knetsch," Journal of Environmental Economics and Management, Elsevier, vol. 23(3), pages 248-257, November.
    12. Smith, V. Kerry, 1992. "Arbitrary values, good causes, and premature verdicts," Journal of Environmental Economics and Management, Elsevier, vol. 22(1), pages 71-89, January.
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    Cited by:
    1. Bateman, Ian J. & Brouwer, Roy, 2006. "Consistency and construction in stated WTP for health risk reductions: A novel scope-sensitivity test," Resource and Energy Economics, Elsevier, vol. 28(3), pages 199-214, August.
    2. Gregory Poe & Jeremy Clark & Daniel Rondeau & William Schulze, 2002. "Provision Point Mechanisms and Field Validity Tests of Contingent Valuation," Environmental & Resource Economics, European Association of Environmental and Resource Economists, vol. 23(1), pages 105-131, September.
    3. Ojea, Elena & Loureiro, Maria L., 2011. "Identifying the scope effect on a meta-analysis of biodiversity valuation studies," Resource and Energy Economics, Elsevier, vol. 33(3), pages 706-724, September.
    4. Powe, N. A. & Bateman, I. J., 2003. "Ordering effects in nested 'top-down' and 'bottom-up' contingent valuation designs," Ecological Economics, Elsevier, vol. 45(2), pages 255-270, June.
    5. Diane Dupont, 2003. "CVM Embedding Effects When There Are Active, Potentially Active and Passive Users of Environmental Goods," Environmental & Resource Economics, European Association of Environmental and Resource Economists, vol. 25(3), pages 319-341, July.

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