Valuation on the frontier: Calibrating actual and hypothetical statements of value
AbstractThe lack of robust evidence showing that hypothetical behavior directly maps into real actions remains a major concern for proponents of stated preference nonmarket valuation techniques. This article explores a new statistical approach to link actual and hypothetical statements. Using willingness-topay field data on individual bids from sealed-bid auctions for a $350 baseball card, our results are quite promising. Estimating a stochastic frontier regression model that makes use of data that any contingent valuation survey would obtain, we derive a bid function that is not statistically different from the bid function obtained from subjects in an actual auction. If other data can be calibrated similarly, this method holds significant promise since an appropriate calibration scheme, ex ante or ex post, can be invaluable to the policy maker that desires more accurate estimates of use and nonuse values for nonmarket goods and services.
Download InfoIf 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.
Bibliographic InfoPaper provided by The Field Experiments Website in its series Framed Field Experiments with number 00159.
Date of creation: 2004
Date of revision:
Contact details of provider:
Web page: http://www.fieldexperiments.com
Other versions of this item:
- 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.
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.:
- Timothy C. Haab & Ju-Chin Huang & John C. Whitehead, 1999.
"Are Hypothetical Referenda Incentive Compatible? A Comment,"
Journal of Political Economy,
University of Chicago Press, vol. 107(1), pages 186-196, February.
- Timothy C. Haab & Ju-Chin Huang & John C. Whitehead, . "Are Hypothetical Referenda Incentive Compatible? A Comment," Working Papers 9708, East Carolina University, Department of Economics.
- John A. List, 2001.
"Do Explicit Warnings Eliminate the Hypothetical Bias in Elicitation Procedures? Evidence from Field Auctions for Sportscards,"
American Economic Review,
American Economic Association, vol. 91(5), pages 1498-1507, December.
- 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.
- Waldman, Donald M., 1982. "A stationary point for the stochastic frontier likelihood," Journal of Econometrics, Elsevier, vol. 18(2), pages 275-279, February.
- List, John A. & Shogren, Jason F., 2002.
"Calibration of Willingness-to-Accept,"
Journal of Environmental Economics and Management,
Elsevier, vol. 43(2), pages 219-233, March.
- Fox, John A. & Shogren, Jason F. & Hayes, Dermot J. & Kliebenstein, James, 1998.
"Cvm-X: Calibrating Contingent Values with Experimental Auction Markets,"
Staff General Research Papers
1311, Iowa State University, Department of Economics.
- 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.
- Fox, John A. & Shogren, J. & Hayes, Dermot J. & Kliebenstein, James, 2003. "Cvm-X: Calibrating Contingent Values with Experimental Auction Markets," Staff General Research Papers 11935, Iowa State University, Department of Economics.
- John List & Jason Shogren, 1998.
"Calibration of the difference between actual and hypothetical valuations in a field experiment,"
Natural Field Experiments
00296, The Field Experiments Website.
- 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.
- Jondrow, James & Knox Lovell, C. A. & Materov, Ivan S. & Schmidt, Peter, 1982. "On the estimation of technical inefficiency in the stochastic frontier production function model," Journal of Econometrics, Elsevier, vol. 19(2-3), pages 233-238, August.
- William C. Horrace & Peter Schmidt, 2002. "Confidence Statements for Efficiency Estimates from Stochastic Frontier Models," Econometrics 0206006, EconWPA.
- 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.
- Whittington, Dale & Sur, Dipika & Cook, Joseph & Chatterjee, Susmita & Maskery, Brian & Lahiri, Malay & Poulos, Christine & Boral, Srabani & Nyamete, Andrew & Deen, Jacqueline & Ochiai, Leon & Bhattac, 2009. "Rethinking Cholera and Typhoid Vaccination Policies for the Poor: Private Demand in Kolkata, India," World Development, Elsevier, vol. 37(2), pages 399-409, February.
- GB. Concu, 2004. "A choice modelling approach to investigate biases in individual and aggregated benefit estimates due to omission of distance," Working Paper CRENoS 200412, Centre for North South Economic Research, University of Cagliari and Sassari, Sardinia.
- Kumbhakar, Subal C. & Parmeter, Christopher F. & Tsionas, Efthymios G., 2012. "Bayesian estimation approaches to first-price auctions," Journal of Econometrics, Elsevier, vol. 168(1), pages 47-59.
- Svensson, Mikael, 2006. "The Value of a Statistical Life in Sweden Estimates from Two Studies using the "Certainty Approach" Calibration," Working Papers 2006:6, Örebro University, School of Business, revised 25 Jul 2007.
- Devkota, Nirmala & Paudel, Krishna P. & Fannin, James Matthew & Hall, Larry M. & Caffey, Rex H., 2007. "Calibrating Online Survey Sample for Economic Impact Analysis," 2007 Annual Meeting, February 4-7, 2007, Mobile, Alabama 34997, Southern Agricultural Economics Association.
- Anabela Botelho & Lígia M.Costa Pinto & Patricia Sousa, 2013. "Valuing wind farms’ environmental impacts by geographical distance: A contingent valuation study in Portugal," NIMA Working Papers 52, Núcleo de Investigação em Microeconomia Aplicada (NIMA), Universidade do Minho.
- Murphy, James J. & Stevens, Thomas H., 2004. "Contingent Valuation, Hypothetical Bias, and Experimental Economics," Agricultural and Resource Economics Review, Northeastern Agricultural and Resource Economics Association, vol. 33(2), October.
- Norwood, F. Bailey, 2005. "Can Calibration Reconcile Stated and Observed Preferences?," Journal of Agricultural and Applied Economics, Southern Agricultural Economics Association, vol. 37(01), April.
- John List & Craig Gallet, 2001. "What Experimental Protocol Influence Disparities Between Actual and Hypothetical Stated Values?," Environmental & Resource Economics, European Association of Environmental and Resource Economists, vol. 20(3), pages 241-254, November.
- Bolliger, Conradin & Reviron, Sophie, 2008. "Consumer Willingness to Pay for Swiss Chicken Meat: An In-store Survey to Link Stated and Revealed Buying Behaviour," 2008 International Congress, August 26-29, 2008, Ghent, Belgium 44155, European Association of Agricultural Economists.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Joe Seidel).
If references are entirely missing, you can add them using this form.