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When does a referent problem affect willingness to pay for a public good?

Author

Listed:
  • Nicolao Bonini

  • Ilana Ritov

  • Michele Graffeo

Abstract

In two studies we examined the willingness to support action to remedy a public problem. In Study 1 people were asked whether they would financially contribute to solution of a public problem. In Study 2, people were asked whether they would sign a petition to support a public action. The aim was to test whether the willingness to support solution of a public problem is affected by the type of problem that is used as the referent. We hypothesized that the willingness to support a public action is lower when evaluated in the context of a high - as opposed to a low - importance referent problem (importance contrast effect). We also hypothesized that the importance contrast effect is tied to the perceived relatedness between the target and referent problems. The importance contrast effect should be found only when the two problems relate to different category domains. The findings bear out this prediction.

Suggested Citation

  • Nicolao Bonini & Ilana Ritov & Michele Graffeo, 2007. "When does a referent problem affect willingness to pay for a public good?," Labsi Experimental Economics Laboratory University of Siena 015, University of Siena.
    • Handle: RePEc:usi:labsit:015
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    References listed on IDEAS

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    JEL classification:

    • C92 - Mathematical and Quantitative Methods - - Design of Experiments - - - Laboratory, Group Behavior

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