The Political Man and Contingent Valuation: Motives Do Count
AbstractIn addition to his role as a consumer pursuing his own interests, an individual may also regard himself as an ethical observer, judging matters from society's point of view. It is not clear which of these possibly conflicting roles respondents in contingent valuation studies take on. This leads to ambiguities in the interpretation of reported willingness to pay. I formalize this problem using a simple model of respondents' behaviour, based on the concept of subjective social welfare functions. The model may provide one explanation to several puzzling phenomena often found in contingent valuation studies; such as large discrepancies between willingness to pay and willingness to accept, frequent occurrence of "outliers" willing to pay extremely large amounts, and certain kinds of framing effects.
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Bibliographic InfoPaper provided by Research Department of Statistics Norway in its series Discussion Papers with number 180.
Date of creation: Sep 1996
Date of revision:
Environmental valuation; social welfare judgements; non-unique preference orderings.;
Find related papers by JEL classification:
- A13 - General Economics and Teaching - - General Economics - - - Relation of Economics to Social Values
- D11 - Microeconomics - - Household Behavior - - - Consumer Economics: Theory
- D61 - Microeconomics - - Welfare Economics - - - Allocative Efficiency; Cost-Benefit Analysis
- D62 - Microeconomics - - Welfare Economics - - - Externalities
- H41 - Public Economics - - Publicly Provided Goods - - - Public Goods
- Q21 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Renewable Resources and Conservation - - - Demand and Supply (the Commons)
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- Karine Nyborg & Inger Spangen, 2000.
"Cost-Benefit Analysis and the Democratic Ideal,"
Nordic Journal of Political Economy,
Nordic Journal of Political Economy, vol. 26, pages 83-93.
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