Advanced Search
MyIDEAS: Login to save this article or follow this journal

What Experimental Protocol Influence Disparities Between Actual and Hypothetical Stated Values?

Contents:

Author Info

  • John List
  • Craig Gallet

    ()

Abstract

Preferences elicited in hypothetical settings have recently come underscrutiny, causing estimates from the contingent valuation method to bechallenged due to perceived ``hypothetical bias.'' Given that the receivedliterature derives value estimates using heterogeneous experimentaltechniques, understanding the effects of important design parameters onthe magnitude of hypothetical bias is invaluable. In this paper, we addressthis issue statistically by using a meta-analysis to examine data from 29experimental studies. Our empirical findings suggest that on averagesubjects overstate their preferences by a factor of about 3 in hypotheticalsettings, and that the degree of over-revelation is influenced by thedistinction between willingness-to-pay and willingness-to-accept, publicversus private goods, and several elicitation methods. Copyright Kluwer Academic Publishers 2001

Download Info

If you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
File URL: http://hdl.handle.net/10.1023/A:1012791822804
Download Restriction: Access to full text is restricted to subscribers.

As the access to this document is restricted, you may want to look for a different version under "Related research" (further below) or search for a different version of it.

Bibliographic Info

Article provided by European Association of Environmental and Resource Economists in its journal Environmental and Resource Economics.

Volume (Year): 20 (2001)
Issue (Month): 3 (November)
Pages: 241-254

as in new window
Handle: RePEc:kap:enreec:v:20:y:2001:i:3:p:241-254

Contact details of provider:
Web page: http://www.springerlink.com/link.asp?id=100263

Related research

Keywords: CVM; hypothetical bias; meta-analysis;

References

References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
as in new window
  1. McClelland, Gary H & Schulze, William D & Coursey, Don L, 1993. " Insurance for Low-Probability Hazards: A Bimodal Response to Unlikely Events," Journal of Risk and Uncertainty, Springer, vol. 7(1), pages 95-116, August.
  2. Seip, K. & Strand, J., 1990. "Willingness To Pay For Environmental Goods In Norway: A Contingent Valuation Study With Real Payment," Memorandum 12/1990, Oslo University, Department of Economics.
  3. John A. Fox & Jason F. Shogren & Dermot J. Hayes & James B. Kliebenstein, 1998. "CVM-X: Calibrating Contingent Values with Experimental Auction Markets," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 80(3), pages 455-465.
  4. Vivien Foster & Ian J. Bateman & David Harley, 1997. "Real And Hypothetical Willingness To Pay For Environmental Preservation: A Non-Experimental Comparison," Journal of Agricultural Economics, Wiley Blackwell, vol. 48(1-3), pages 123-137.
  5. Spencer, Michael A. & Swallow, Stephen K. & Miller, Christopher J., 1998. "Valuing Water Quality Monitoring: A Contingent Valuation Experiment Involving Hypothetical And Real Payments," Agricultural and Resource Economics Review, Northeastern Agricultural and Resource Economics Association, vol. 27(1), April.
  6. John List & Jay Shogren, 2002. "Calibration of willingness-to-accept," Framed Field Experiments 00182, The Field Experiments Website.
  7. Brookshire, David S & Coursey, Don L, 1987. "Measuring the Value of a Public Good: An Empirical Comparison of Elicitation Procedures," American Economic Review, American Economic Association, vol. 77(4), pages 554-66, September.
  8. Cummings, Ronald G & Harrison, Glenn W & Rutstrom, E Elisabet, 1995. "Homegrown Values and Hypothetical Surveys: Is the Dichotomous Choice Approach Incentive-Compatible?," American Economic Review, American Economic Association, vol. 85(1), pages 260-66, March.
  9. Kealy, Mary Jo & Montgomery, Mark & Dovidio, John F., 1990. "Reliability and predictive validity of contingent values: Does the nature of the good matter?," Journal of Environmental Economics and Management, Elsevier, vol. 19(3), pages 244-263, November.
  10. John List, 2001. "Do explicit warnings eliminate the hypothetical bias in elicitation procedures? Evidence from field auctions for sportscards," Framed Field Experiments 00163, The Field Experiments Website.
  11. Richard A. Hofler & John A. List, 2004. "Valuation on the Frontier: Calibrating Actual and Hypothetical Statements of Value," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 86(1), pages 213-221.
  12. Bohm, Peter, 1972. "Estimating demand for public goods: An experiment," European Economic Review, Elsevier, vol. 3(2), pages 111-130.
  13. Espey, Molly, 1998. "Gasoline demand revisited: an international meta-analysis of elasticities," Energy Economics, Elsevier, vol. 20(3), pages 273-295, June.
  14. Grether, David M & Plott, Charles R, 1979. "Economic Theory of Choice and the Preference Reversal Phenomenon," American Economic Review, American Economic Association, vol. 69(4), pages 623-38, September.
  15. Balistreri, Edward J. & Poe, Gregory L. & McClelland, Gary H. & Schulze, William D., 1996. "Can Hypothetical Questions Reveal True Values? A Laboratory Comparison of Dichotomous Choice and Open-Ended Contingent Values with Auction Values," Working Papers 127865, Cornell University, Department of Applied Economics and Management.
  16. List, John A. & Shogren, Jason F., 1998. "Calibration of the difference between actual and hypothetical valuations in a field experiment," Journal of Economic Behavior & Organization, Elsevier, vol. 37(2), pages 193-205, October.
  17. Mary Jo Kealy & John F. Dovidio & Mark L. Rockel, 1988. "Accuracy in Valuation Is a Matter of Degree," Land Economics, University of Wisconsin Press, vol. 64(2), pages 158-171.
  18. Thomas C. Brown & Patricia A. Champ & Richard C. Bishop & Daniel W. McCollum, 1996. "Which Response Format Reveals the Truth about Donations to a Public Good?," Land Economics, University of Wisconsin Press, vol. 72(2), pages 152-166.
  19. List, John A & Shogren, Jason F, 1998. "The Deadweight Loss of Christmas: Comment," American Economic Review, American Economic Association, vol. 88(5), pages 1350-55, December.
  20. John Loomis & Thomas Brown & Beatrice Lucero & George Peterson, 1997. "Evaluating the Validity of the Dichotomous Choice Question Format in Contingent Valuation," Environmental & Resource Economics, European Association of Environmental and Resource Economists, vol. 10(2), pages 109-123, September.
  21. Frykblom, Peter, 1997. "Hypothetical Question Modes and Real Willingness to Pay," Journal of Environmental Economics and Management, Elsevier, vol. 34(3), pages 275-287, November.
  22. repec:feb:framed:0032 is not listed on IDEAS
  23. Coursey, Don L & Hovis, John L & Schulze, William D, 1987. "The Disparity between Willingness to Accept and Willingness to Pay Measures of Value," The Quarterly Journal of Economics, MIT Press, vol. 102(3), pages 679-90, August.
  24. John Loomis & Thomas Brown & Beatrice Lucero & George Peterson, 1996. "Improving Validity Experiments of Contingent Valuation Methods: Results of Efforts to Reduce the Disparity of Hypothetical and Actual Willingness to Pay," Land Economics, University of Wisconsin Press, vol. 72(4), pages 450-461.
  25. Smith, V. Kerry & Mansfield, Carol, 1998. "Buying Time: Real and Hypothetical Offers," Journal of Environmental Economics and Management, Elsevier, vol. 36(3), pages 209-224, November.
  26. 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.
  27. Dickie, M. & Fisher, A. & Gerking, S.D., 1987. "Market transactions and hypothetical demand data: A comparative study," Open Access publications from Tilburg University urn:nbn:nl:ui:12-4628501, Tilburg University.
  28. Helen R. Neill & Ronald G. Cummings & Philip T. Ganderton & Glenn W. Harrison & Thomas McGuckin, 1994. "Hypothetical Surveys and Real Economic Commitments," Land Economics, University of Wisconsin Press, vol. 70(2), pages 145-154.
  29. Cummings, Ronald G, et al, 1997. "Are Hypothetical Referenda Incentive Compatible?," Journal of Political Economy, University of Chicago Press, vol. 105(3), pages 609-21, June.
  30. Magnus Johannesson & Bengt Liljas & Per-Olov Johansson, 1998. "An experimental comparison of dichotomous choice contingent valuation questions and real purchase decisions," Applied Economics, Taylor & Francis Journals, vol. 30(5), pages 643-647.
  31. Tim Jeppesen & John A. List & Henk Folmer, 2002. "Environmental Regulations and New Plant Location Decisions: Evidence from a Meta-Analysis," Journal of Regional Science, Wiley Blackwell, vol. 42(1), pages 19-49.
  32. Peter Frykblom, 2000. "Willingness to pay and the choice of question format: experimental results," Applied Economics Letters, Taylor & Francis Journals, vol. 7(10), pages 665-667.
  33. Sinden, Jack A., 1988. "Empirical Tests Of Hypothetical Bias In Consumers' Surplus Surveys," Australian Journal of Agricultural Economics, Australian Agricultural and Resource Economics Society, vol. 32(02-03).
Full references (including those not matched with items on IDEAS)

Citations

RePEc Biblio mentions

As found on the RePEc Biblio, the curated bibliography for Economics:
  1. > Environmental and Natural Resource Economics > Environmental Economics > Valuation > Contingent valuation method > Hypothetical bias
Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
as in new window

Cited by:
This item has more than 25 citations. To prevent cluttering this page, these citations are listed on a separate page.

Lists

This item is not listed on Wikipedia, on a reading list or among the top items on IDEAS.

Statistics

Access and download statistics

Corrections

When requesting a correction, please mention this item's handle: RePEc:kap:enreec:v:20:y:2001:i:3:p:241-254. See general information about how to correct material in RePEc.

For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Guenther Eichhorn) or (Christopher F. Baum).

If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

If references are entirely missing, you can add them using this form.

If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.

If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.

Please note that corrections may take a couple of weeks to filter through the various RePEc services.