Does the knowledge of the origin of the health damage matter for WTP estimates?
AbstractIn this paper, we show that expressed willingness-to-pay (WTP) for reducing symptoms caused by air pollution, crucially depends on the respondents being aware of the origin of the symptoms. We observe that the average stated WTP is 50 % higher when respondents are informed in the questionnaire that air pollution is the origin of the bad health state. Since the information about the origin of the improvement of the health state is not neutral with respect to the valuation exercise, we discuss the relative merits of the two alternative methods : providing the information about the origin of the health improvement or not. We argue in favour of the alternative that provides that information. Indeed, without the information provided in the questionnaire, there is a risk that the valuation is based on individual information and subjective references. On the contrary, with the information, all willingness-to-pay are focused on the same cause, providing a better control over individual responses.
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Bibliographic InfoPaper provided by Bureau d'Economie Théorique et Appliquée, UDS, Strasbourg in its series Working Papers of BETA with number 9904.
Date of creation: 1999
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Find related papers by JEL classification:
- C93 - Mathematical and Quantitative Methods - - Design of Experiments - - - Field Experiments
- Q26 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Renewable Resources and Conservation - - - Recreational Aspects of Natural Resources
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- V. Kerry Smith, 1996. "Can Contingent Valuation Distinguish Economic Values for Different Public Goods?," Land Economics, University of Wisconsin Press, vol. 72(2), pages 139-151.
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- Hoehn, John P & Randall, Alan, 1989. "Too Many Proposals Pass the Benefit Cost Test," American Economic Review, American Economic Association, vol. 79(3), pages 544-51, June.
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