Willingness to Pay for Car Safety: Sensitivity to Time Framing
AbstractStated preference (SP) surveys attempt to obtain monetary values for non-market goods that reflect individuals' “true”' preferences. Numerous empirical studies suggest that monetary values from SP studies are sensitive to survey design and so may not reflect respondents' true preferences. This study examines the effect of time framing on respondents' willingness to pay (WTP) for car safety. We explore how WTP per unit risk reduction depends on the time period over which respondents pay and face reduced risk. Using data from a Swedish contingent valuation survey, we find that WTP is sensitive to time framing; estimates based on an annual scenario are about 30 to 70 percent higher than estimates from a monthly scenario.
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Bibliographic InfoPaper provided by Swedish National Road & Transport Research Institute (VTI) in its series Working Papers with number 2008:8.
Length: 27 pages
Date of creation: 03 Jul 2008
Date of revision:
Contact details of provider:
Postal: VTI, Transport Economics, P.O. Box 6056, SE-171 06 Solna, Sweden
Phone: +46-13-20 40 00
Fax: +46-13-14 14 36
Web page: http://www.vti.se/tek
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Car safety; Contingent valuation; Double bound; Willingness to pay;
Find related papers by JEL classification:
- C52 - Mathematical and Quantitative Methods - - Econometric Modeling - - - Model Evaluation, Validation, and Selection
- D60 - Microeconomics - - Welfare Economics - - - General
- I10 - Health, Education, and Welfare - - Health - - - General
- Q51 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Valuation of Environmental Effects
This paper has been announced in the following NEP Reports:
- NEP-ALL-2008-07-14 (All new papers)
- NEP-DCM-2008-07-14 (Discrete Choice Models)
- NEP-ENV-2008-07-14 (Environmental Economics)
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