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Household Versus Individual Valuation: What’s the Difference?

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  • Ian Bateman
  • Alistair Munro

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Abstract

Standard practice in stated preference typically blurs the distinction between household and individual responses, but without a clear theoretical or empirical justification for this approach. To date there have been no empirical tests of whether values for say a two adult household elicited by interviewing one randomly selected adult are the same as the values generated by interviewing both adults simultaneously. Using cohabiting couples, we conduct a choice experiment field study valuing reductions in dietary health risks. In one treatment a random individual is chosen from the couple and interviewed alone; in the other treatment, both partners are questioned jointly. We find significant differences in household values calculated from joint as opposed to individual responses, with further variation between the values elicited from men and women. Our results question the assumption, implicit in common practice, that differences between individually and jointly elicited estimates of household values can effectively be ignored.

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File URL: http://hdl.handle.net/10.1007/s10640-009-9268-6
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Bibliographic Info

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

Volume (Year): 43 (2009)
Issue (Month): 1 (May)
Pages: 119-135

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Handle: RePEc:kap:enreec:v:43:y:2009:i:1:p:119-135

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Web page: http://www.springerlink.com/link.asp?id=100263

Related research

Keywords: Household values; Choice experiment; Contingent valuation; Food and health risks; C920; D130; D80;

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References

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  1. Alistair Munro & Ian Bateman, 2004. "An Experiment On Risky Choice Amongst Households," Royal Economic Society Annual Conference 2004 77, Royal Economic Society.
  2. Dupont, Diane P., 2004. "Do children matter? An examination of gender differences in environmental valuation," Ecological Economics, Elsevier, vol. 49(3), pages 273-286, July.
  3. Becker, Gary S, 1974. "A Theory of Social Interactions," Journal of Political Economy, University of Chicago Press, vol. 82(6), pages 1063-93, Nov.-Dec..
  4. Alderman, H. & Chiappori, P.A. & Haddad, L., 1994. "Unitary versus Collective Models of the Household: Time to Shift the Burden of Proof?," DELTA Working Papers 94-17, DELTA (Ecole normale supérieure).
  5. John Quiggin, 1998. "Individual and Household Willingness to Pay for Public Goods," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 80(1), pages 58-63.
  6. M. Browning & P. A. Chiappori, 1998. "Efficient Intra-Household Allocations: A General Characterization and Empirical Tests," Econometrica, Econometric Society, vol. 66(6), pages 1241-1278, November.
  7. Donna Dosman & Wiktor Adamowicz, 2006. "Combining Stated and Revealed Preference Data to Construct an Empirical Examination of Intrahousehold Bargaining," Review of Economics of the Household, Springer, vol. 4(1), pages 15-34, 03.
  8. Louviere,Jordan J. & Hensher,David A. & Swait,Joffre D. With contributions by-Name:Adamowicz,Wiktor, 2000. "Stated Choice Methods," Cambridge Books, Cambridge University Press, number 9780521788304, October.
  9. David Hensher & Nina Shore & Kenneth Train, 2005. "Households’ Willingness to Pay for Water Service Attributes," Environmental & Resource Economics, European Association of Environmental and Resource Economists, vol. 32(4), pages 509-531, December.
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Citations

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Cited by:
  1. Schröder, Melanie & Schmitt, Norma & Heynemann, Britta & Brünn, Claudia, 2013. "Income Taxation and Labor Supply: An Experiment on Couple's Work Effort," Annual Conference 2013 (Duesseldorf): Competition Policy and Regulation in a Global Economic Order 79735, Verein für Socialpolitik / German Economic Association.
  2. Goode, Alison & Mavromaras, Kostas G. & Smith, Murray, 2008. "Intergenerational Transmission of Healthy Eating Behaviour and the Role of Household Income," IZA Discussion Papers 3535, Institute for the Study of Labor (IZA).
  3. André De Palma & Nathalie Picard & Anthony Ziegelmeyer, 2009. "Individual and couple decision behavior under risk: Evidence on the dynamics of power balance," Working Papers hal-00418899, HAL.
  4. Marcella Veronesi & Martina Menon & Federico Perali, 2007. "Extensions of the Traditional Travel Cost Model of Non-Market Valuation to a Collective Framework: Evidence from the Field," Working Papers 42/2007, University of Verona, Department of Economics.
  5. Lindhjem, Henrik, 2006. "20 years of stated preference valuation of non-timber benefits from Fennoscandian forests: A meta-analysis," MPRA Paper 11467, University Library of Munich, Germany.
  6. Evans, Mary F. & Poulos, Christine & Kerry Smith, V., 2011. "Who counts in evaluating the effects of air pollution policies on households? Non-market valuation in the presence of dependencies," Journal of Environmental Economics and Management, Elsevier, vol. 62(1), pages 65-79, July.
  7. Kannika Thampanishvong, 2013. "Determinants of Flash Flood Evacuation Choices and Assessment of Preferences for Flash Flood Warning Channels: The Case of Thailand," EEPSEA Research Report rr2013034, Economy and Environment Program for Southeast Asia (EEPSEA), revised Mar 2013.
  8. Demont, Matty & Rutsaert, Pieter & Ndour, Maimouna & Verbeke, Wim & Seck, Papa Abdoulaye & Tollens, Eric, 2012. "Experimental auctions, collective induction and choice shift: Willingness-to-pay for rice quality in Senegal," 2012 Conference, August 18-24, 2012, Foz do Iguacu, Brazil 126861, International Association of Agricultural Economists.
  9. Wiktor Adamowicz & Mark Dickie & Shelby Gerking & Marcella Veronesi & David Zinner, 2013. "Household Decision-Making and Valuation of Environmental Health Risks to Parents and their Children," NCEE Working Paper Series 201306, National Center for Environmental Economics, U.S. Environmental Protection Agency, revised Dec 2013.
  10. Henrik Lindhjem & Ståle Navrud, 2009. "Asking for Individual or Household Willingness to Pay for Environmental Goods?," Environmental & Resource Economics, European Association of Environmental and Resource Economists, vol. 43(1), pages 11-29, May.

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