Is Referendum the Same as Dichotomous Choice Contingent Valuation?
The NOAA Panel on contingent valuation (Arrow et al. 1993) recommends that the valuation question be cast under the form of a referendum because of incentive properties and familiarity to the respondent. Even though the literature has generally accepted the panel recommendation, it is not clear whether explicitly mentioning a referendum leads to different values than asking a dichotomous (yes/no) question without mentioning any voting process. The results of our specifically designed contingent valuation survey indicate that the estimated willingness to pay is significantly larger when a referendum is explicitly mentioned.
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- Alberini, Anna & Boyle, Kevin & Welsh, Michael, 2003. "Analysis of contingent valuation data with multiple bids and response options allowing respondents to express uncertainty," Journal of Environmental Economics and Management, Elsevier, vol. 45(1), pages 40-62, January.
- W. Michael Hanemann, 1984. "Welfare Evaluations in Contingent Valuation Experiments with Discrete Responses," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 66(3), pages 332-341.
- Satterthwaite, Mark Allen, 1975. "Strategy-proofness and Arrow's conditions: Existence and correspondence theorems for voting procedures and social welfare functions," Journal of Economic Theory, Elsevier, vol. 10(2), pages 187-217, April.
- Vossler, Christian A. & Kerkvliet, Joe, 2003. "A criterion validity test of the contingent valuation method: comparing hypothetical and actual voting behavior for a public referendum," Journal of Environmental Economics and Management, Elsevier, vol. 45(3), pages 631-649, May.
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