An investigation of individual preferences: consistency across incentives and stability over time
AbstractThis study compares individual preferences across incentives (i.e., hypothetical vs. real incentives) and over time (i.e. elicitation at two different points in time) in a choice experiment involving charitable donating decisions. We provide evidence of hypothetical bias but little evidence of instability of individual giving. There is significant heterogeneity in individual preferences, with real incentives either dampening or pronouncing the observed donating behaviour. Neither hypothetical bias nor instability is observed when we examine the propensity of individuals to make internally consistent decisions over identical choices.
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Bibliographic InfoPaper provided by Department of Economics - University of Zurich in its series ECON - Working Papers with number 070.
Date of creation: Apr 2012
Date of revision:
Individual preference; hypothetical bias; time inconsistency; discrete choice experiments; charitable donations;
Find related papers by JEL classification:
- C91 - Mathematical and Quantitative Methods - - Design of Experiments - - - Laboratory, Individual Behavior
- D11 - Microeconomics - - Household Behavior - - - Consumer Economics: Theory
- D91 - Microeconomics - - Intertemporal Choice and Growth - - - Intertemporal Consumer Choice; Life Cycle Models and Saving
- H40 - Public Economics - - Publicly Provided Goods - - - General
This paper has been announced in the following NEP Reports:
- NEP-ALL-2012-04-10 (All new papers)
- NEP-CBE-2012-04-10 (Cognitive & Behavioural Economics)
- NEP-DCM-2012-04-10 (Discrete Choice Models)
- NEP-EXP-2012-04-10 (Experimental Economics)
- NEP-UPT-2012-04-10 (Utility Models & Prospect Theory)
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