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Cheap Talk Revisited: New Evidence from CVM

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  • David Aadland

    (Utah State University)

  • Arthur J. Caplan

    (Utah State University)

Abstract

Two recent studies have shown that “cheap talk” is an effective means of eliminating positive hypothetical bias in experimental and field-auction settings. We further investigate the ability of cheap talk to mitigate positive hypothetical bias in a CVM phone survey administered to over 4,000 households. Positive hypothetical bias is detected in our data by contrasting revealed and stated preference information. However, a short, neutral cheap-talk script appears to exacerbate rather than mitigate the bias. Based on this and mixed evidence from earlier studies, we suggest caution in using cheap talk as an ex ante control for hypothetical bias.

Suggested Citation

  • David Aadland & Arthur J. Caplan, 2003. "Cheap Talk Revisited: New Evidence from CVM," Others 0301001, University Library of Munich, Germany.
    • Handle: RePEc:wpa:wuwpot:0301001
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    1. David Aadland & Arthur J. Caplan, 2006. "Curbside recycling: Waste resource or waste of resources?," Journal of Policy Analysis and Management, John Wiley & Sons, Ltd., vol. 25(4), pages 855-874.
    2. Spash, Clive L., 2008. "The Contingent Valuation Method: Retrospect and Prospect," MPRA Paper 101234, University Library of Munich, Germany.
    3. Satimanon, Thasanee & Weatherspoon, Dave D., 2010. "Hedonic Analysis of Sustainable Food Products," International Food and Agribusiness Management Review, International Food and Agribusiness Management Association, vol. 13(4), pages 1-17.
    4. Richard Carson & Theodore Groves, 2007. "Incentive and informational properties of preference questions," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 37(1), pages 181-210, May.
    5. Dominique Ami & Frédéric Aprahamian & Olivier Chanel & Stéphane Luchini, 2011. "A Test of Cheap Talk in Different Hypothetical Contexts: The Case of Air Pollution," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 50(1), pages 111-130, September.
    6. Jacob Ladenburg & Søren Bøye Olsen, 2010. "Gender anomalies in Stated Preference surveys – Are biases really gender dependent?," IFRO Working Paper 2010/1, University of Copenhagen, Department of Food and Resource Economics.
    7. Karen Blumenschein & Glenn C. Blomquist & Magnus Johannesson & Nancy Horn & Patricia Freeman, 2008. "Eliciting Willingness to Pay Without Bias: Evidence from a Field Experiment," Economic Journal, Royal Economic Society, vol. 118(525), pages 114-137, January.
    8. Carlsson, Fredrik & Kataria, Mitesh & Krupnick, Alan & Lampi, Elina & Löfgren, Åsa & Qin, Ping & Sterner, Thomas, 2013. "The truth, the whole truth, and nothing but the truth—A multiple country test of an oath script," Journal of Economic Behavior & Organization, Elsevier, vol. 89(C), pages 105-121.

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    More about this item

    Keywords

    cheap talk; hypothetical bias; contingent valuation;
    All these keywords.

    JEL classification:

    • C35 - Mathematical and Quantitative Methods - - Multiple or Simultaneous Equation Models; Multiple Variables - - - Discrete Regression and Qualitative Choice Models; Discrete Regressors; Proportions
    • Q26 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Renewable Resources and Conservation - - - Recreational Aspects of Natural Resources

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