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Graded pairs comparison - does strength of preference matter? Analysis of preferences for specialised nurse home visits for pain management

Listed author(s):
  • Mickael Bech

    (Institute of Public Health, University of Southern Denmark, Denmark)

  • Dorte Gyrd-Hansen

    (Institute of Public Health, University of Southern Denmark, Denmark)

  • Trine Kjær

    (Institute of Public Health, University of Southern Denmark, Denmark)

  • Jørgen Lauridsen

    (Department of Business and Economics, University of Southern Denmark, Denmark)

  • Jan Sørensen

    (Centre for Applied Health Services Research and Technology Assessment, University of Southern Denmark, Denmark)

In the stated preference method called graded pairs comparisons respondents are asked to rate the intensity of their preference for their preferred alternative in a pairwise comparison of alternatives. Econometricians anticipate that the additional information will improve statistical efficiency compared to the standard DCE format. However, this paper reveals that added information inherent in graded pairs scale does not provide smaller standard deviations for the WTP estimated. Secondly, the ordered-response regression models employing the full range of the graded pairs data tend to overestimate WTP, which presumably is caused by the inherent tendency of the ordered-response models to 'predict to the extremes'. Copyright © 2006 John Wiley & Sons, Ltd.

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Article provided by John Wiley & Sons, Ltd. in its journal Health Economics.

Volume (Year): 16 (2007)
Issue (Month): 5 ()
Pages: 513-529

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Handle: RePEc:wly:hlthec:v:16:y:2007:i:5:p:513-529
DOI: 10.1002/hec.1159
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  1. de Palma, Andre & Myers, Gordon M & Papageorgiou, Yorgos Y, 1994. "Rational Choice under an Imperfect Ability to Choose," American Economic Review, American Economic Association, vol. 84(3), pages 419-440, June.
  2. Marisa J. Mazzotta & James J. Opaluch, 1995. "Decision Making When Choices Are Complex: A Test of Heiner's Hypothesis," Land Economics, University of Wisconsin Press, vol. 71(4), pages 500-515.
  3. Swallow, Stephen K. & Opaluch, James J. & Weaver, Thomas F., 2001. "Strength-of-Preference Indicators and an Ordered-Response Model for Ordinarily Dichotomous, Discrete Choice Data," Journal of Environmental Economics and Management, Elsevier, vol. 41(1), pages 70-93, January.
  4. Michelle A. Haefele & John B. Loomis, 2001. "Improving Statistical Efficiency and Testing Robustness of Conjoint Marginal Valuations," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 83(5), pages 1321-1327.
  5. Johnson, F. Reed & Desvousges, William H., 1997. "Estimating Stated Preferences with Rated-Pair Data: Environmental, Health, and Employment Effects of Energy Programs," Journal of Environmental Economics and Management, Elsevier, vol. 34(1), pages 79-99, September.
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