scholarly journals Comparing treatments to reduce hypothetical bias in choice experiments regarding organic food

2020 ◽  
Vol 47 (3) ◽  
pp. 1302-1337 ◽  
Author(s):  
Adelina Gschwandtner ◽  
Michael Burton
Keyword(s):  
Willingness To Pay ◽  
Stated Preference ◽  
Organic Food ◽  
Cheap Talk ◽  
Food Products ◽  
Choice Experiments ◽  
Hypothetical Bias ◽  
Stated Preference Methods ◽  
The Uk

Abstract Hypothetical bias is one of the strongest criticisms brought to stated preference methods. We evaluate and compare the use of Cheap Talk and Honesty Priming as methods to mitigate such bias. Our study analyses the demand for organic food products in the UK, and the results reveal a core of consumers with positive willingness to pay (WTP) for organic. However, when correcting for hypothetical bias, consumers appear to be willing to pay even more for other attributes. Most importantly, the results show that implementing mechanisms to correct for hypothetical bias are efficient to reduce WTP, with Cheap Talk having a higher overall significance than Honesty Priming.

Videos Improve Attention and Cheap Talk in Online Surveys

2021 ◽  
Vol 16 (2) ◽  
pp. 347-376
Author(s):  
Jerrod Penn ◽  
◽  
Wuyang Hu ◽  
Keyword(s):  
Willingness To Pay ◽  
Choice Experiment ◽  
Stated Preference ◽  
Cheap Talk ◽  
Hypothetical Bias ◽  
Control Group ◽  
Online Surveys ◽  
Participant Engagement ◽  
Reducing Potential

Cheap Talk (CT) is a mainstay technique among stated preference practitioners to reduce Hypothetical Bias (HB). The usefulness of CT may be questionable in online surveys due to the limited control researchers have on participant engagement. In the context of an online choice experiment on hotels, we compare a control group of respondents who receives a CT script as a traditional passage of text versus a group who must answer an attention-check question to verify their comprehension of the script as well as another group who receives the CT script as a video and then answer the attention-check question. We find that compared to the control group, simply offering the attention-check question reduced willingness to pay (WTP), and those who answer the attention-check question correctly behaved differently to those who did not. Overall, video CT script is shown to improve attention and be more effective in reducing potential HB than a text-based script.

A query theory account of a discrete choice experiment under oath

2019 ◽  
Vol 47 (3) ◽  
pp. 1133-1172
Author(s):  
Nathan P Kemper ◽  
Jennie S Popp ◽  
Rodolfo M Nayga
Keyword(s):  
Discrete Choice Experiment ◽  
Discrete Choice ◽  
Choice Experiment ◽  
Stated Preference ◽  
Choice Experiments ◽  
Hypothetical Bias ◽  
Discrete Choice Experiments ◽  
Thought Processes ◽  
Stated Preference Methods ◽  
Ex Ante

Abstract One limitation of stated-preference methods is the formation of hypothetical bias. To address this, the honesty oath has been used as an ex ante technique to reduce hypothetical bias. Our study provides a query account of the honesty oath in a discrete-choice experiment setting by using Query Theory to examine the mechanism behind the effectiveness of the honesty oath. Our results show that the honesty oath can change the content and order of queries; potentially reducing hypothetical bias in discrete choice experiments. The study suggests the potential usefulness of Query Theory in examining thought processes of respondents in valuation studies.

Hypothetical Bias in Choice Experiments: Is Cheap Talk Effective at Eliminating Bias on the Intensive and Extensive Margins of Choice?

2012 ◽  
Vol 12 (1) ◽  
Author(s):  
Ryan Bosworth ◽  
Laura O. Taylor
Keyword(s):  
Experimental Design ◽  
Willingness To Pay ◽  
Experimental Approach ◽  
Cheap Talk ◽  
Choice Experiments ◽  
Nonmarket Valuation ◽  
Hypothetical Bias ◽  
Extensive Margin ◽  
Empirical Regularities ◽  
Do So

Abstract We use an experimental approach to evaluate the effectiveness of the most commonly employed bias-mitigation tool in nonmarket valuation surveys: the cheap talk script. Our experimental design allows us to estimate treatment effects on two margins of choice separately: the decision to enter the market at all (the extensive margin) and the choices among alternatives offered (the intensive margin). The key result of this study is to show that a cheap talk script appears to affect both margins in ways distinctly different than when choices involve actual payments. Specifically, participants in hypothetical choice experiments including cheap talk are more inclined to enter the market but are also more price-sensitive as compared to when payments are real. Interestingly, the average influence of cheap talk on market participation and price-sensitiveness could result in total willingness to pay (WTP) estimates that are similar to real payment treatments since the two effects identified act in opposite directions when computing WTP. However, they may do so by inducing behavior that is distinctly different than those of consumers facing real choices. Our results highlight that future reliance on cheap talk as a bias mitigation tool requires extensive testing for empirical regularities to gain any confidence that the tool can be effective, and under what circumstances.

scholarly journals Using Choice Experiments to Value Non-Market Goods and Services: Evidence from Field Experiments

2006 ◽  
Vol 5 (2) ◽  
Author(s):  
John A. List ◽  
Paramita Sinha ◽  
Michael H. Taylor
Keyword(s):  
Field Experiments ◽  
Stated Preference ◽  
Empirical Work ◽  
Cheap Talk ◽  
Choice Experiments ◽  
Economic Benefits ◽  
Hypothetical Bias ◽  
Purchase Decision ◽  
Goods And Services ◽  
Consumption Decisions

Abstract Critics of stated preference methods argue that hypothetical bias precludes survey techniques from providing reliable economic values for non-market goods and services, rendering estimation of the total economic benefits of public programs fruitless. This paper explores a relatively new methodology to obtain the total value of non-market goods and services—choice experiments—which conveniently provide information on the purchase decision as well as the characteristic value vector. The empirical work revolves around examining behavior in two very different field settings. In the first field study, we explore hypothetical bias in the purchase decision by eliciting contributions for a threshold public good in an actual capital campaign. To extend the analysis a level deeper, in a second field experiment we examine both the purchase decision and the marginal value vector via inspection of consumption decisions in an actual marketplace. In support of the new valuation design, both field experiments provide some evidence that hypothetical choice experiments combined with “cheap talk” can yield credible estimates of the purchase decision. Furthermore, we find no evidence of hypothetical bias when estimating marginal attribute values. Yet, we do find that the “cheap talk” component might induce internal inconsistency of subjects’ preferences in the choice experiment.

scholarly journals Putting their money where their mouths are: Consumer willingness to pay for multi-ingredient, processed organic food products

Food Policy ◽  
2007 ◽  
Vol 32 (2) ◽  
pp. 145-159 ◽  
Author(s):  
Marvin T. Batte ◽  
Neal H. Hooker ◽  
Timothy C. Haab ◽  
Jeremy Beaverson
Keyword(s):  
Willingness To Pay ◽  
Organic Food ◽  
Food Products

State of the Art of Contingent Valuation

2020 ◽  
Author(s):  
Tim Haab ◽  
Lynne Lewis ◽  
John Whitehead
Keyword(s):  
Contingent Valuation ◽  
Discrete Choice ◽  
Stated Preference ◽  
Revealed Preference ◽  
Choice Experiments ◽  
Discrete Choice Experiments ◽  
Actual Behavior ◽  
Stated Preference Methods ◽  
Valuation Methods ◽  
Hypothetical Scenario

The contingent valuation method (CVM) is a stated preference approach to the valuation of non-market goods. It has a 50+-year history beginning with a clever suggestion to simply ask people for their consumer surplus. The first study was conducted in the 1960s and over 10,000 studies have been conducted to date. The CVM is used to estimate the use and non-use values of changes in the environment. It is one of the more flexible valuation methods, having been applied in a large number of contexts and policies. The CVM requires construction of a hypothetical scenario that makes clear what will be received in exchange for payment. The scenario must be realistic and consequential. Economists prefer revealed preference methods for environmental valuation due to their reliance on actual behavior data. In unguarded moments, economists are quick to condemn stated preference methods due to their reliance on hypothetical behavior data. Stated preference methods should be seen as approaches to providing estimates of the value of certain changes in the allocation of environmental and natural resources for which no other method can be used. The CVM has a tortured history, having suffered slings and arrows from industry-funded critics following the Exxon Valdez and British Petroleum (BP)–Deepwater Horizon oil spills. The critics have harped on studies that fail certain tests of hypothetical bias and scope, among others. Nonetheless, CVM proponents have found that it produces similar value estimates to those estimated from revealed preference methods such as the travel cost and hedonic methods. The CVM has produced willingness to pay (WTP) estimates that exhibit internal validity. CVM research teams must have a range of capabilities. A CVM study involves survey design so that the elicited WTP estimates have face validity. Questionnaire development and data collection are skills that must be mastered. Welfare economic theory is used to guide empirical tests of theory such as the scope test. Limited dependent variable econometric methods are often used with panel data to test value models and develop estimates of WTP. The popularity of the CVM is on the wane; indeed, another name for this article could be “the rise and fall of CVM,” not because the CVM is any less useful than other valuation methods. It is because the best practice in the CVM is merging with discrete choice experiments, and researchers seem to prefer to call their approach discrete choice experiments. Nevertheless, the problems that plague discrete choice experiments are the same as those that plague contingent valuation. Discrete choice experiment–contingent valuation–stated preference researchers should continue down the same familiar path of methods development.

scholarly journals Incentive Compatible Referenda and the Valuation of Environmental Goods

1998 ◽  
Vol 27 (2) ◽  
pp. 132-139 ◽  
Author(s):  
Laura O. Taylor
Keyword(s):  
Willingness To Pay ◽  
Contingent Valuation ◽  
Contingent Valuation Method ◽  
Experimental Tests ◽  
Choice Experiments ◽  
Hypothetical Bias ◽  
The Real ◽  
Environmental Goods ◽  
Incentive Compatible ◽  
Valuation Method

Recent attempts to test the validity of the contingent valuation method have relied on laboratory-type experiments. In these experiments, willingness to pay responses in hypothetical choice experiments are compared with responses from choice experiments requiring actual payments. Often evidence of hypothetical bias is found. Critical for these experimental tests of hypothetical surveys is that the methodology used to elicit willingness to pay from subjects in the real-payment experiment be demand revealing. If it is not, then differences in responses to hypothetical and real valuation questions could be due to free-riding in the real-payment survey and not due to hypothetical bias in the hypothetical survey. This paper reports on experiments that implement a theoretically incentive-compatible revelation mechanism (a closed referendum) to elicit responses to valuation questions in both hypothetical and real experiments. As in earlier studies, evidence of an upward hypothetical bias is found.

scholarly journals Influence of Socio-Psychological Factors on Consumer Willingness to Pay (WTP) for Organic Food Products

2018 ◽  
Vol 10 (5(J)) ◽  
pp. 208-219 ◽  
Author(s):  
Lloyd J.S. Baiyegunhi ◽  
Sikhumbuzo E. Mashabane ◽  
Nonjabulo C Sambo
Keyword(s):  
Willingness To Pay ◽  
Psychological Factors ◽  
Food Policy ◽  
Organic Food ◽  
Food Products ◽  
Policy Implications ◽  
Number Of Children ◽  
Using Data ◽  
Socio Demographic Factors ◽  
Vegetables And Fruits

This study evaluates consumers’ willingness to pay (WTP) a premium for organic vegetables and fruits in Pietermaritzburg metropolis, KwaZulu-Natal province, South Africa, using data collected from 210 consumers approached during their food shopping. The standard economic approach to valuation was extended by including psychological factors. The results from the empirical model show that psychological factors (behavioural control, attitude and subjective norms) exerted more influence on consumers’ WTP for organic products. In addition, socio-demographic factors such as gender, education, number of children in a household, high income and race, are statistically significant in explaining consumers’ WTP for organic food. Policy implications for advancement and improved promotion, sales and consumption of organic food products were discussed.  

Preferencias declaradas y disposición a pagar por la conservación de biodiversidad en un área natural protegida de Perú: Un análisis exploratorio / Stated preference and willingness to pay for conserving biodiversity in a protected area of Peru: exploratory Analysis

2021 ◽  
Vol 4 (3) ◽  
pp. 3018-3034
Author(s):  
Carlos Alberto Minaya Gutiérrez ◽  
Duber Orlando Chinguel Labán ◽  
Pether López García
Keyword(s):  
Willingness To Pay ◽  
Protected Area ◽  
Stated Preference ◽  
Choice Experiments ◽  
Exploratory Analysis

En los últimos años, la preocupación por conservar la biodiversidad – e indirectamente los servicios ecosistémicos asociados que proporcionan bienestar humano – ha ganado gran importancia a nivel mundial, principalmente por los efectos negativos del cambio climático, la degradación de recursos naturales y los altos índices de contaminación. En ese contexto, se reconoce que la conservación es un tema complejo, pero socialmente deseable que involucra variables biofísicas, socioeconómicas y políticas. De esta manera, el objetivo del presente estudio es analizar las preferencias de la sociedad peruana, respecto a los atributos de la biodiversidad en el Parque Nacional del Manu y su relación con la disposición a pagar (DAP) para su conservación. La metodología de valoración económica empleada, es la de preferencias declaradas a través del modelo choice experiments. Los atributos de biodiversidad considerados, fueron: especies de flora, especies de fauna, cobertura forestal y contribución económica mensual, en un horizonte temporal de 1 año. Los resultados indican que la DAP para conservación de biodiversidad de un peruano asciende a S/. 4 / mes, en promedio, especialmente por la conservación de especies de fauna.

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