Template-Type: ReDIF-Paper 1.0
Author-Name:  James J. Murphy
Author-Name-First: James
Author-Name-Last: Murphy
Author-Email:  murphy@uaa.alaska.edu
Author-Workplace-Name: Department of Economics, University of Alaska Anchorage
Author-Name:  Thomas H. Stevens
Author-Name-First: Thomas
Author-Name-Last: Stevens
Author-Email:  tstevens@resecon.umass.edu
Author-Workplace-Name: Department of Resource Economics, University of Massachusetts Amherst
Author-Name:  Lava Yadav
Author-Name-First: Lava
Author-Name-Last: Yadav
Author-Workplace-Name: Department of Resource Economics, University of Massachusetts Amherst
Title:  A Comparison of Induced Value and Home-Grown Value Experiments to Test for Hypothetical Bias in Contingent Valuation 
Abstract:  This study tests the hypothesis that hypothetical bias may not be related to value elicitation; rather it may be a value formation problem.  When participants are asked to indicate their willingness to pay for an induced value good, we find no evidence of hypothetical bias for three different commodity types (public good, private good, and publicly provided private good).  However, when these same subjects are asked to value homegrown goods with no pre-assigned induced value using the same elicitation mechanism, hypothetical values are roughly double actual payments in all three cases.  These results support the hypothesis that the process of forming values in a homegrown setting may be a key contributor to hypothetical bias.

Creation-date: 2010-03
File-URL: http://www.econpapers.uaa.alaska.edu/RePEC/ala/wpaper/ALA201006.pdf
File-Format: Application/pdf
Classification-JEL: C91, H41, Q26, Q28, C90, Q51
Keywords: contingent valuation, hypothetical bias, experiments, induced values, home-grown values, experimental economics, environmental economics
Publication-Status: Published in Environmental and Resource Economics, 47(1):111-123
Number: 2010-06
Handle: RePEc:ala:wpaper:2010-06