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Self-Image and Valuation of Moral Goods: Stated versus Real Willingness to Pay

Author

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  • Johansson-Stenman, Olof

    () (Department of Economics, School of Business, Economics and Law, Göteborg University)

  • Svedsäter, Henrik

    () (Organisational Behaviour, London Business School, United Kingdom)

Abstract

Hypothetical bias in stated-preference methods appears sometimes to be very large, and other times non-existent. This is here largely explained by a model where people derive utility from a positive self-image associated with morally commendable behavior. The results of a choice experiment are consistent with the predictions of this model; the hypothetical marginal willingness to pay (MWTP) for a moral good (contributions to a WWF project) is significantly higher than the corresponding real MWTP, whereas no hypothetical bias is present for an amoral good (a restaurant voucher). Moreover, both the theoretical model and the experimental evidence suggest that also the real MWTP for the moral good is biased upwards by being higher within than outside the experimental context.

Suggested Citation

  • Johansson-Stenman, Olof & Svedsäter, Henrik, 2011. "Self-Image and Valuation of Moral Goods: Stated versus Real Willingness to Pay," Working Papers in Economics 484, University of Gothenburg, Department of Economics.
  • Handle: RePEc:hhs:gunwpe:0484
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    File URL: http://hdl.handle.net/2077/24143
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    References listed on IDEAS

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    More about this item

    Keywords

    Stated-preference methods; choice experiment; hypothetical bias; self-image; non-market valuation; warm glow;

    JEL classification:

    • C91 - Mathematical and Quantitative Methods - - Design of Experiments - - - Laboratory, Individual Behavior
    • D63 - Microeconomics - - Welfare Economics - - - Equity, Justice, Inequality, and Other Normative Criteria and Measurement
    • Q50 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - General

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