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Dichotomous-choice contingent valuation with 'dont know' responses and misreporting


  • Kelvin Balcombe

    (Department of Agricultural and Food Economics, University of Reading, Reading, UK)

  • Iain Fraser

    (School of Economics, University of Kent, UK)


A new approach is presented that simultaneously deals with Misreporting and Don't Know (DK) responses within a dichotomous-choice contingent valuation framework. Utilising a modification of the standard Bayesian Probit framework, a Gibbs with Metropolis-Hastings algorithm is used to estimate the posterior densities for the parameters of interest. Several model specifications are applied to two contingent valuation datasets: one on wolf management plans, and one on the US Fee Demonstration Program. We find that DKs are more likely to be from people who would be predicted to have positive utility for the bid. Therefore, a DK is more likely to be a YES than a NO. We also find evidence of misreporting, primarily in favour of the NO option. The inclusion of DK responses has an unpredictable impact on willingness-to-pay estimates, since it impacts differently on the results for the two datasets we examine. Copyright © 2009 John Wiley & Sons, Ltd.

Suggested Citation

  • Kelvin Balcombe & Iain Fraser, 2009. "Dichotomous-choice contingent valuation with 'dont know' responses and misreporting," Journal of Applied Econometrics, John Wiley & Sons, Ltd., vol. 24(7), pages 1137-1152.
  • Handle: RePEc:jae:japmet:v:24:y:2009:i:7:p:1137-1152
    DOI: 10.1002/jae.1109

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    References listed on IDEAS

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    Cited by:

    1. Kelvin Balcombe & Aurelia Samuel & Iain Fraser, 2009. "Estimating WTP With Uncertainty Choice Contingent Valuation," Studies in Economics 0921, School of Economics, University of Kent.
    2. Uehleke, Reinhard, 2016. "The role of question format for the support for national climate change mitigation policies in Germany and the determinants of WTP," Energy Economics, Elsevier, vol. 55(C), pages 148-156.

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