An Examination of Consistency in the Incremental Approach to Willingness to Pay: Evidence Using Societal Values for NHS Dental Services

Introduction Willingness to pay (WTP) is used to generate information about value. However, when comparing 2 or more services using standard WTP techniques, the amounts elicited from participants for the services are often similar, even when individuals state a clear preference for one service over another. An incremental approach has been suggested, in which individuals are asked to first rank interventions and provide a WTP value for their lowest-ranked intervention followed by then asking how much more they are willing to pay for their next preferred choice and so on. To date, evaluation of this approach has disregarded protest responses, which may give information on consistency between stated and implicit rankings. Methods A representative sample of the English population ( n = 790) were asked to value 5 dental services adopting a societal perspective, using a payment vehicle of additional household taxation per year. The sample was randomized to either the standard or the incremental approach. Performance for both methods is assessed on discrimination between values for interventions and consistency between implicit and stated ranks. The data analysis is the first to retain protest responses when considering consistency between ranks. Results The results indicate that neither approach provides values that discriminate between interventions. Retaining protest responses reveals inconsistencies between the stated and implicit ranks are present in both approaches but much reduced in the incremental approach. Conclusion The incremental approach does not improve discrimination between values, yet there is less inconsistency between ranks. The protest responses indicate that objections to giving values to the dental interventions are dependent on a multitude of factors beyond the elicitation process.

Developing the Questionnaire

This chapter outlines the essential topics for developing and testing a questionnaire for a discrete choice experiment survey. It addresses issues such as the description of the environmental good, pretesting of the survey, incentive compatibility, consequentiality or mitigation of hypothetical bias. For the latter, cheap talk scripts, opt-out reminders or an oath script are discussed. Moreover, the use of instructional choice sets, the identification of protest responses and strategic bidders are considered. Finally, issues related to the payment vehicle and the cost vector design are the subject of this section.

Assessing the Preservation of Parks and Natural Protected Areas: A Review of Contingent Valuation Studies

The existence of parks is particularly important and offers many benefits both to the environment and to humans. Parks are recreational spaces, which contribute to the improvement of the microclimate, reduce atmospheric pollution and protect biodiversity. Their importance for the urban environment is even greater because they offer pure oxygen to the city and people feel close to nature in them. The aim of this study is to review studies which took place globally as well as in Greece, relying on the Contingent Valuation Method (CVM) for parks. The reason that this method is used is the valuation of non-market goods and services through the development of a hypothetical market. Additionally, a distinction is made among previous empirical studies depending on the nature of the parks and the country where the survey was conducted, while the disadvantages that must be considered from the use of Contingent Valuation Method are mentioned. According to the findings of the literature review, studies using Contingent Valuation in Greece, particularly in the case of urban parks, are limited. As far as we know, the valuation of existing urban parks has not yet been studied, so this could be a field for further research. The economic valuation of parks in a country like Greece, which suffered with the financial crisis, can lead to conclusions about the value that citizens attribute to parks and the identification of possible protest responses.

Choosing not to choose: A meta-analysis of status quo effects in environmental valuations using choice experiments

<p>Discrete choice experiments (DCE) normally include in their choice sets an option described as the status quo (i.e. no change to current situation; SQ). The literature has identified Status Quo Effect (SQE) as the systematic preference of the SQ over the alternatives that propose changes over and beyond what can be captured by the variation of attributes’ levels. In this paper, we conduct a meta-analysis of DCE applied in environmental policy to identify potential drivers of SQE. We find that accounting for heterogeneity in the econometric analysis, excluding protest responses and easing the choice’s cognitive burden reduce the presence of SQE.</p>

A general model for treatment of protests and no-answer responses in contingent valuation method

This study formulates a general model to account for the protest responses and no-answer replies. The distinct characteristics of this model are general in three ways: simultaneously accounting for protest and no-answer responses, applicable to all kinds of elicitation formats in contingent valuation, and simplicity in estimation. Creation of inverse Mills ratio is the distinctive step in this general model. The inverse Mills ratio is continuously carried in the subsequent estimation for the modification of different types of elicitation formats in this general model. The results generally indicate that these ratios are significantly different from zero. This means that accounting for these Mills ratios does have an important role in such modification when protest responses and/or no-answer responses are both taken into account. The results show that overall total willingness to pay from the general model with inclusion of protest and no-answer responses under different types of elicitation formats are higher than those estimated by traditional treatment. The degree of underestimation of traditional treatment is between 26% and 67%. That is, the general model proposed here for treating protest and/or no-answer responses in contingent valuation method can account for the full information, which might be potentially omitted or inappropriately dealt with in the estimation.