incentive incompatibility and starting point bias in iterative valuation questions comment in a recent study whitehead 2002 proposes incentive incompatibility and startingpoint bias tests for iterative willingness to pay questions we show that if restrictions associated with the nature of starting point bias are not imposed on the estimation one obtains inconsistent estimates of the structural parameters and may draw inaccurate conclusions regarding the extent of incentive incompatibility and starting point bias in contingent valuation survey data jel q26 c35

households willingness to pay for health microinsurance and its impact on actual take up results from a field experiment in senegal abstractcommunity based health insurance schemes cbhis have been present in the region of theis senegal for many years yet despite the benefits they offer take up rates remain low this article measures the willingness to pay wtp for cbhis premiums in such a context our results highlight the role of income wealth and risk preferences as determinants of wtp we also provide an analysis of the predictive power of wtp on the actual take up of insurance following our offering of membership to a sample of 360 households results show that wtp has a positive and significant impact on actual cbhis take up

statistical efficiency of double bounded dichotomous choice contingent valuation the statistical efficiency of conventional dichotomous choice contingent valuation surveys can be improved by asking each respondent a second dichotomous choice question which depends on the response to the first question if the first response is yes the second bid is some amount greater than the first bid while if the first response is no the second bid is some amount smaller this double bounded approach is shown to be asymptotically more efficient than the conventional singlebounded approach using data from a survey of californians regarding their willingness to pay for wetlands in the san joaquin valley we show that in a finite sample the gain in efficiency can be very substantial

implications of bid design and willingness to pay distribution for starting point bias in double bounded dichotomous choice contingent valuation surveys we examine starting point bias in double bounded dichotomous choice contingent valuation surveys we investigate 1 the seriousness of the biases for the location and scale parameters of the willingness to pay wtp in the presence of starting point bias 2 whether or not these biases depend on the distribution of wtp and on the bid design and 3 how well a commonly used diagnostic for starting point bias a test of the null that bid set dummies entered in the right hand side of the wtp model are jointly equal to zero performs under various circumstances monte carlo simulations suggest that the effect of ignoring starting point bias depends on the bid design and on the true distribution of wtp a well balanced symmetric bid design may result in very modest biases even when the anchoring mechanism is very strong the power of bid set dummies in detecting starting point bias is low they tend to account for misspecifications in the distribution assumed by the researcher for the latent wtp rather than capturing the presence of starting point bias

trends in unemployment duration data a method of estimating the distribution of uninterrupted unemploymentspells from aggregate unemployment data is outlined the methodology does not i mpose constant individual hazard rates and allows for heterogeneity characteris tics of the distribution of unemployment spells are then considered including ha zard rates measures of inequality such as gini coefficients and the fraction o f total unemployment associated with s weeks of unemploy ment the relationship between these char acteristics and labor demand variables gnp and supply side variables transfer payments unemployment insurance is considered in or der to better understand the relative role of short and long run unemployment copyright 1986 by mit press

estimation using contingent valuation data from a dichotomous choice with follow up questionnaire reply abstract our original article proposed that the two yes no willingness to pay wtp responses produced by this survey format should be viewed as a pair of jointly distributed correlated discrete random variables the comparison model the conventional approach to estimation using these types of data contained a programming error correction alters the results from the comparison model but our original claim that estimation by conventional methods can produce misleading inferences if ours is the appropriate specification still stands this is especially true if negative wtp is precluded when e wtp is calculated

improving willingness to pay estimates for quality improvements through joint estimation with quality perceptions willingness to pay for quality change may depend on heterogeneous perceived quality levels contingent valuation studies should include measures of quality perceptions as covariates in the willingness to pay model in order to avoid omitted variable bias variation in quality perceptions across respondents leads to a potential endogeneity of quality perceptions i address the potential for endogeneity bias using an instrumental variables approach in which a measure of quality perceptions is included as a determinant of willingness to pay and is simultaneously determined by various exogenous factors the willingness to pay model is estimated jointly with quality perceptions allowing for correlation of the error terms using data on willingness to pay for water quality improvements in the neuse river in north carolina i reject exogeneity of perceived quality correcting for endogeneity improves the measurement of willingness to pay by differentiating willingness to pay among respondents with heterogeneous quality perceptions

incentive incompatibility and starting point bias in iterative valuation questions we test for incentive incompatibility and starting point bias to describe the effects of iterative valuation questions on willingness to pay we compare double triple and multiplebounded models with data from two surveys with similar designs of the valuation questions we find that incentive incompatibility is present in both sets of data and starting point bias is present in one the efficiency of the willingness to pay estimate is improved in only one set of data the potential loss from using iterative questions without controlling for both incentive incompatibility and starting point bias is biased willingness topay estimates

participatory environmental education and willingness to pay for river basin management empirical evidence from nigeria this paper examines the role of participation as a tool for improving individuals perceptions and environmental values using a test retest experiment conducted in south eastern nigeria two identical contingent valuation experiments were interspersed by participatory workshops designed to involve respondents in framing and forming the valuation scenario econometric analyses found that participatory education significantly developed individuals perceptions of pollution problems and increased the magnitude and precision of their wtp for a river basin management scheme the extent of changes in perceptions declined with increasing levels of formal education suggesting that less educated respondents are more likely to hold weakly formed preferences

the economic consequences of health shocks evidence from vietnam this paper finds that the incomes of urban households are more vulnerable to health shocks than rural households that health shocks may precipitate increases in unearned income that partially offset reductions in earned income and large increases in medical spending even among insured households it also finds that households spend less on food following a health shock but more on budget items such as housing and electricity measures of household health shocks used include a recent death of a working age household member a long inpatient spell and a recent sizeable drop in the body mass index of the household head

occupations and the evolution of gender differences in intergenerational socioeconomic mobility this paper analyzes intergenerational mobility experiences of daughters and sons with respect to their fathers occupational status and documents changes in gender differences over time while women have been in occupations with lower overall earnings potential men are more likely to be in occupations characterized by long hours and low returns the mobility gap in earnings has been closing and a mobility advantage with respect to education has been emerging

economic evaluation of healthcare technology improving the quality of social life the case of assistive technology for the disabled and elderly abstractpublic investments in healthcare technology for the disabled and elderly to improve the quality of social life have been vigorous but the economic evaluation of the assistive technology is still lacking under this circumstance the purpose of this study is to analyse the socio economic value of developing assistive technologies with the potential to improve the quality of social life especially for disabled and elderly individuals based on a survey of 400 respondents the spike model a special form of the contingent valuation method cvm is applied to assess the value of assistive technologies in korea a household s willingness to pay wtp for the development of assistive technologies is us 4 26 per year on average in the form of a government levied tax although many people express zero wtp for the development of these technologies people with higher household savings higher levels of education and higher levels of charity donations have a higher wtp for the development of assistive

the measurement of labor force dynamics with longitudinal data the labour market activity survey filter this article explores the measurement of labor force dynamics using longitudinal data focusing in particular on the canadian labour market activity survey lmas which represents a potential advance in longitudinal data collection because it measures aspects of dynamics not available in existing panel data such as the panel study of income dynamics and the national longitudinal survey we examine the implications of the lmas questionnaire structure the lmas filter for the study of labor market dynamics and undertake simulations to provide a quantitative assessment of the importance of this filter for labor force spells and transitions between labor force states

ordering anomalies in choice experiments this paper investigates whether responses to choice experiments ces are subject to ordering anomalies while previous research has focussed on the possibility that such anomalies relate to position in the sequence of choice tasks our research reveals that the particular order of tasks matters using a novel experimental design that allows us to test our hypotheses using simple nonparametric statistics we observe ordering anomalies in ce data similar to those recorded in the dichotomous choice contingent valuation literature those ordering effects operate in both price and commodity dimensions and are observed to compound over a series of choice tasks our findings cast serious doubt on the current practice of asking each respondent to undertake several choice tasks in a ce while treating each response as an independent observation on that individual s preferences

interval estimates of non market resource values from referendum contingent valuation surveys contingent valuation methods cvm have attracted considerable attention in recent years as researchers have begun to resort to survey methods to elicit individual values for non market goods such as environmental resources or public goods cummings brookshire and schulze 1986 and mitchell and carson 1989 offer comprehensive assessments of these methods cvm survey questions come in a variety of forms one format which has proven to be popular is called the discrete choice or take it or leave it referendum or closedended question originally implemented in the literature by bishop and heberlein 1979 since respondents find it very difficult to identify precisely their true point value of access to some resource or public good open ended valuation questions can be unreliable or can discourage response in contrast most people are familiar with being confronted by a posted price for a good and with deciding whether or not they would buy at that price this is the strategy behind discrete choice cvm questions a different hypothetical price is offered to each respondent and by their yes no response to the question of whether they would be willing to pay this price the researcher gains information about their true underlying point value one persistent difficulty with the econometric techniques that are currently used most widely to analyze referendum contingent valuation data is the absence of confidence intervals for the ultimate value estimates early empirical applications approximate mean valuations using a truncated mean based on a logit model with the upper limit being the highest bid value in the sample unfortunately the variance of this estimated mean cannot easily be recovered from the numerical integration procedure commonly used to calculate the

some generalized mixture distributions with an application to unemployment duration compounding or mixture distributions provide a rich class of models for applications ranging from models of heterogeniety measurement error distribution of stock returns and income to models of unemployment duration some very general mixtures are considered which include many new mixture models and also provide a unified method of organizing and comparing previously considered models as well as a test of heterogeneity these models are used to analyze cps unemployment duration data a heterogeniety interpretation of the mixture models explains the discrepancy between implications of search theory and patterns observed in aggregate unemployment data copyright 1987 by mit press

are stated preferences convergent with revealed preferences empirical evidence from nigeria abstract the debate on the relevance of monetary valuation of environmental goods has often hinged around the convergence of stated and revealed preferences and in turn the actual money choices of respondents in this paper we report two separate experiments conducted in southeastern nigeria to compare irrigators stated willingness to pay for a river basin restoration scheme designed to mitigate soil and water pollution problems in their farms with their actual expenditures to mitigate the same pollution problems we found that the farmers stated and revealed preferences were significantly correlated but yielded significantly different means at 5 level while econometric analysis reveals a systematic association between key socioeconomic variables and farmers stated wtp lending credence to the cvm within its theoretical framework analysis of the qualitative follow ups reveals inconsistencies in some farmers stated and revealed preferences that cannot be satisfactorily explained on the basis of economic theory alone while individual utility maximisation was a dominant driver of both stated and revealed preferences for most farmers lack of environmental awareness information complexity risk aversion and peer pressure were seen to limit the ability and willingness of the least educated segment of the sample to make apparently rational economic decisions in both markets overall the results question the use of convergent and or theoretical validity arguments for justifying and or criticising the use of stated preference experiments in environmental policy

hypothetical versus real willingness to pay in the health care sector results from a field experiment abstract we conducted a field experiment comparing hypothetical and real purchase decisions for a pharmacist provided asthma management program among 172 subjects with asthma subjects received either a dichotomous choice contingent valuation question or were given the opportunity to actually enroll in the program three different prices were used us 15 40 and 80 in the hypothetical group 38 of subjects said that they would purchase the good at the stated price but only 12 of subjects in the real group purchased the good p 0 000 we cannot however reject the null hypothesis that definitely sure hypothetical yes responses as identified in a follow up question correspond to real yes responses we conclude that the dichotomous choice contingent valuation method overestimates willingness to pay but that it may be possible to correct for this overestimation by sorting out definitely sure yes responses

can higher prices stimulate product use evidence from a field experiment in zambia the controversy over how much to charge for health products in the developing world rests in part on whether higher prices can increase use either by targeting distribution to high use households a screening effect or by stimulating use psychologically through a sunk cost effect we develop a methodology for separating these two effects we implement the methodology in a field experiment in zambia using door to door marketing of a home water purification solution we find evidence of economically important screening effects by contrast we find no consistent evidence of sunk cost effects jel c93 d12 i11 m31 o12

the net benefit of saving the asian elephant a policy and contingent valuation study reports results from a contingent valuation cv survey of willingness to pay wtp for the conservation of the asian elephant of a sample of urban residents living in three selected housing schemes in colombo the capital of sri lanka face to face surveys were conducted using an interview schedule is a non linear logit regression model is used to analyse the respondents responses for the payment principle questions and to identify the factors that influence their responses we investigate whether urban residents wtp for the conservation of elephants is sufficient to compensate farmers for the damage caused by elephants we find that the beneficiaries the urban residents could compensate losers the fanners in the areas affected by human elephant conflict hec and be better off than in the absence of elephants in sri lanka therefore there is a strong economic case for the conservation of the wild elephant population in sri lanka however we have insufficient data to determine the optimal level of this elephant population in the kaldor hicks sense nevertheless the current population of elephant in sri lanka is kaldor hicks preferable to having none c 2003 elsevier b v all rights reserved

income smoothing and consumption smoothing one way that risk averse households protect consumption levels is to borrow and use insurance mechanisms another way common in low income economies is to diversify economic activities and make conservative production and employment choices households thus tend toward limiting exposure only to shocks that can be handled with available credit and insurance typically both types of mechanisms are studied independently but much more can be learned by studying them together first we obtain a more complete picture of risks costs and insurance possibilities second it opens the way to considering biases in standard tests of credit and insurance

gender specific starting point bias in choice experiments evidence from an empirical study abstract in this paper we test whether preferences and willingness to pay estimates obtained in a choice experiment study are susceptible to starting point bias as is often the case in dichotomous choice contingent valuation studies on the basis of a multinomial probit model we find that preferences are indeed susceptible to starting point bias in a split sample design our results suggest that varying the price levels displayed in a so called instructional choice set presented prior to the actual preference eliciting choice sets significantly impacts respondents preferences and willingness to pay for protecting danish nature areas from new motorway development in particular our results show that the bias is gender specific only female respondents are significantly affected results further reveal that the impact of the starting point bias decays as respondents evaluate more and more choice sets this supports the discovered preference hypothesis and on the basis of this we suggest a number of ways to potentially mitigate the starting point bias

the demand for a malaria vaccine evidence from ethiopia this study measures the monetary value households place on preventing malaria in tigray ethiopia we estimate a household demand function for a hypothetical malaria vaccine and compute the value of preventing malaria as the household s maximum willingness to pay to provide vaccines for all family members this is contrasted with the traditional costs of illness medical costs and lost productivity our results indicate that the value of preventing malaria with vaccines is about us 36 per household per year or about 15 of imputed annual household income this is on average about twice the expected household cost of illness

unemployment behaviour evidence from the cps work experience survey this chapter is empirical and descriptive rather than theoretical it examines the cps unemployment experience data which gives the number of weeks of unemployment and the number of spells of unemployment experienced by a sample of people in a year this chapter focuses on both the entry rate or frequency probability of entering and the exit rate or duration probability of exiting of unemployment spells for it is on both the entry and exit rates that the level and distribution of unemployment depends the conclusion is that entry rates and differences in entry rates across people are of primary importance in explaining unemployment experience

controlling starting point bias in double bounded contingent valuation surveys in this paper we study starting point bias in double bounded contingent valuation surveys this phenomenon arise in applications that use multiple valuation questions indeed response to follow up valuation questions may be influenced by the bid proposed in the initial valuation question previous research have been conducted in order to control for such an effect however they find that efficiency gains are lost when we control for undesirable response effects relative to a single dichotomous choice question contrary to these results we propose a way to control for starting point bias in double bounded questions with gains in efficiency

fat tails and truncated bids in contingent valuation an application to an endangered shorebird species a yes response function in a contingent valuation study is said to have fat tails if it has a high and slowly declining yes response rate at high bid levels truncated bids refer to the practice of dropping high bid offers before a yes response rate of near zero is reached this is a common practice in contingent valuation we explore the extent and implications of fat tails and truncated bids in a study of an endangered shorebird species we find among other things that mean willingness to pay is quite sensitive to the highest bid offered so much so that the choice of highest bid nearly dictates outcomes

if you have the flu symptoms your asymptomatic spouse may better answer the willingness to pay question evidence from a double bounded dichotomous choice model with heterogeneous anchoring the small sample size of contingent valuation cv surveys conducted in patients may have limited the use of the single bounded sb dichotomous choice format which is recommended in environmental economics in this paper we explore two ways to increase the statistical efficiency of the sb format 1 by the inclusion of proxies in addition to patients 2 by the addition of a follow up dichotomous question i e the double bounded db dichotomous choice format we found that patients n 223 and spouses n 64 answering on behalf of the patient had on average a similar willingness to pay for earlier alleviation of flu symptoms however a patient was significantly more likely to anchor his her answer on the first bid as compared to a spouse finally our original db model with shift effect and heterogeneous anchoring reconciled the discrepancies found in willingness to pay statistics between sb and db models in keeping with increased statistical efficiency

universal health insurance in the clinton plan coverage as a tax financed public good the financing arrangements embodied in the clinton health reform plan involve some important differences in the way in which public goods are usually financed the subsidies to small low wage firms mandated to provide benefits distort markets in both labor and products and offer incentives for the creation of small firms in addition the financing scheme implicitly envisions a head tax on families at modest income levels but offers a possible rationale for it nevertheless the main reason for many of the financing features appears to be an attempt to hold down the apparent budgetary cost of universal coverage

the contingent valuation debate why economists should care t he contingent valuation method involves the use of sample surveys questionnaires to elicit the willingness of respondents to pay for generally hypothetical projects or programs the name of the method refers to the fact that the values revealed by respondents are contingent upon the constructed or simulated market presented in the survey a spirited and occasionally mean spirited battle over such methods is currently being waged involving competing factions within the federal government economists and lawyers representing business and environmental groups and interested academics as well at issue is a seemingly quite specific question should environmental regulations currently under development at both the department of the interior and the department of commerce sanction the use of the contingent valuation method in estimating the damage done by spills of oil chemicals or other substances covered by federal law more generally the debate raises broad questions about what economists have to say about the values that individuals place on public or private goods the two papers that follow this one make cases for and against the use of the contingent valuation method my aim here is to provide an overview of the technique and the debate surrounding it i also want to suggest why this debate should matter to economists both professionally and in their roles as citizens and consumers

validity of open ended and payment scale approaches to eliciting willingness to pay the open ended and payment scale approaches to eliciting willingness to pay wtp valuations are compared use of the payment scale led to a higher response rate a higher rate of completion of the wtp question higher mean and median wtp values a stronger association between wtp and ability to pay and a higher r2 in regression analysis of wtp on several independent variables taking these results in combination it can be inferred that the payment scale technique leads to more valid wtp values than use of the open ended approach

welfare measurements using contingent valuation a comparison of techniques three commonly used techniques of asking contingent valuation questions are compared iterative bidding payment cards and dichotomous choice the results reveal that no single contingent valuation technique is neutral in the elicitation of hicksian surplus and each technique has its strengths and weaknesses the iterative bidding estimates contain a starting point bias while the payment card and dichotomous choice estimates were influenced by the interviewers soliciting the contingent values finally the analysis of dichotomous choice responses involves unresolved issues that warrant further investigation on the other hand dichotomous choice is the easiest technique to administer in a survey setting

valuing health care using willingness to pay a comparison of the payment card and dichotomous choice methods this paper compares willingness to pay wtp estimates generated from the dichotomous choice dc and payment card pc approaches in a split sample wtp experiment concerned with allocating scarce health care resources across three health care interventions the dc approach is shown consistently to generate larger welfare estimates than the pc observed difference between pc and dc experiments cannot be explained by the inclusion of non demanders or methods of statistical analysis but may be partly explained by yea saying no evidence of range bias or mid point bias was found with pc responses data were also collected on respondents ordinal rankings of the three interventions and person trade offs ptos neither of these approaches converged with wtp future work must address the decision heuristics individuals employ when responding to valuation experiments

limited dependent variables in willingness to pay studies applications in health care the appropriate technique for econometric analysis of wtp willingness to pay data is an issue which has not been addressed in many studies of wtp for health and health care this paper argues that whether an open ended question or a payment scale approach is adopted the way in which wtp is recorded means that limited dependent variable models are more appropriate than standard regression analysis data from an open ended question on wtp for maternity care contain a large proportion of zeros and the evidence suggests that a two part specification performs better than ols or a standard tobit model if the payment scale method is adopted our argument suggests that grouped data regression is an appropriate econometric technique in practice with data from a study in northern norway the results from ols and grouped data regression are broadly similar

are french consumers ready to pay a premium for eco labeled seafood products a contingent valuation estimation with heterogeneous anchoring could the future french eco label for fresh seafood products find its place in the french market this study employs a contingent valuation method to estimate french consumers willingness to pay wtp for eco labeled fresh seafood products we exploit original data from a survey carried out in 2010 where 626 participants responded to a double bounded dichotomous choice model through an ascending or descending bid system controlling for shift and anchoring effects in random effect probit models we significantly improve estimation of wtp and its determinants for the three species studied monkfish lobster sole in particular when using heterogeneous anchoring we show that wtp is positively correlated to respondents income and also to their environmental concern to living alone to living far from the coast and to trusting ngos or public institutions more than producer organizations to implement an eco label we also show that the mean price premiums do not differ between species finally on average the maximum premium consumers accepted to pay is approximately 10 of the product price

exploring preference anomalies in double bounded contingent valuation double bounded dichotomous choice dbdc contingent valuation offers increased efficiency of willingness to pay wtp estimates compared with the single bounded format however evidence suggests dbdc generates anomalous respondent behaviour this paper provides the first investigation and explanation of these anomalies in health results suggest the incentives for truthful preference revelation are altered in the presence of a follow up question this result is found using both regression techniques and analysis of raw responses although findings suggest very certain respondents exhibit less anomalous behaviour inconsistencies remain across bounds the results of this study question the use of iterative valuation formats

starting point bias in dichotomous choice valuation with follow up questioning abstract follow up questions are frequently used to improve the efficiency of dichotomous choice contingent valuation questionnaires however a number of authors e g 12 16 have noted a significant difference between the wtp distributions implied by initial and follow up question responses this paper investigates starting point bias as one explanation for the phenomenon we develop a model of starting point bias in the context of dichotomous choice questioning with follow up using a monte carlo simulation to illustrate the potential bias imparted to wtp estimates an application is provided based on data from a cv study in northcentral iowa

designing transactions without framing effects in iterative question formats abstract several studies document that iterative question formats used in contingent valuation studies produce anomalies in respondent behavior that appear to threaten the validity of welfare estimates by decomposing iterative question formats into their ascending and descending sequences we show that these anomalies occur only in ascending sequences we describe the conditions under which comparable patterns of behavior are likely to be found in other iterative question formats that begin with a discrete willingness to pay question we then develop a unified explanation of these anomalies using our model of framing based on prospect theory we provide the first head to head test of rival explanations of these behavioral patterns by developing refutable hypotheses for the strategic behavior yea saying anchoring and cost expectations models finally based on our own statistically robust model we show how these anomalies can be eliminated without loss of the statistical efficiency of most iterative question formats

a general model of starting point bias in double bounded dichotomous contingent valuation surveys abstract this paper develops a general model that addresses the starting point bias in the dichotomous choice evaluation data by incorporating both the anchoring effect and yea saying bias the model is applied to a contingent valuation study that evaluated the health benefits of air quality improvement in three major metropolitan areas in taiwan the empirical evidence shows a strong anchoring effect but an insignificant yea saying bias the results show a serious understated willingness to pay if the biases in anchoring and yea saying are not controlled

modeling starting point bias as unobserved heterogeneity in contingent valuation surveys an application to air pollution up to now the starting point bias has generally been considered to be a homogeneous phenomenon in this article we treat anchoring as an unobserved heterogeneous phenomenon our contribution is twofold first we show analytically and by way of simulations that assuming homogeneous anchoring can be hazardous and lead to misspecifications second we propose an econometric model that starts with a dichotomous question and then uses an open ended question we finally apply our model to a contingent valuation survey on air quality our results suggest that how anchoring is modeled in empirical studies deserves more attention

modeling shifts in willingness to pay from a bayesian updating perspective this paper derives a structural shift empirical specification for a double bound dichotomous choice contingent valuation methodology premised upon willingness to pay wtp shifts ensuing from a representative model of respondent bayesian updating behavior we demonstrate by way of data simulations that a traditional structural shift specification may often fail at estimating true wtp in this context further simulations demonstrate that a simple extension of the traditional structural shift model derived explicitly from our bayesian framework can correct for much of the wtp bias with an empirical application confirming the simulation outcomes finally we investigate the relationship between strategic behavior and wtp shifts

estimating compensation payments for on farm conservation of agricultural biodiversity in developing countries article i nfo this paper examines the role of direct compensation payments for agrobiodiversity conservation using minor millet landraces in india as an example the cost of farmer participation in a hypothetical payments for agrobiodiversity conservation services pacs scheme is estimated using a stated preference valuation approach significant inter crop and inter varietal differences are observed with respect to consumption values upon which the compensation demanded by farm households is shown to primarily depend drawing on a categorisation of consumption values and farmer preferences the paper points to the importance of si multaneously considering a range of potential interventions in order to conserve a priority portfolio of agrobiodiverse resources in predominantly subsistence based agricultural systems

procedural invariance testing of the one and one half bound dichotomous choice elicitation method the contingent valuation method for estimating willingness to pay for public goods typically adopts a single referendum question format which is relatively statistically inefficient as an alternative cooper hanemann and signorello 2002 propose the one and one half bound oohb format allowing researchers to question respondents about both a lower and higher limit on project costs thereby securing substantial gains in statistical efficiency using an experimental design we find that responses to oohb valuation questions fail crucial tests of procedural invariance we test various competing models of observed response patterns including strategic misrepresentation of standard preferences and nonstandard models of preference formation

contingent valuation of community forestry programs in ethiopia controlling for preference anomalies in double bounded cvm this study examines the welfare effects of community plantations in ethiopia via contingent valuation both single bounded and double bounded survey methods were considered and with respect to double bounded methods the potential for anomalous response behaviour was also taken into account the results generally confirm that there are statistically significant welfare benefits to be derived from community forestry however the range of the estimated benefits is large after controlling for anomalous response behaviour the range of estimated benefits narrows and our preferred estimates place the welfare gain between ethiopian birr etb 20 14 and 30 41 per household which is much lower than the estimated benefits without controlling for anomalous preference responses

duration dependence targeted employment subsidies and unemployment benefits abstract this paper is concerned with the economic justification of targeted employment training subsidies it deals with the question is the policy of providing training subsidies to employers to hire from a target group of long term unemployment benefit recipients preferable to that of providing unemployment benefits alone in the sense that it can yield a cost reduction if so what are the optimal durations of waiting period for enrolment into the training program and the period of subsidy the answer is shown to depend upon inter alia four effects the disincentive effect on job search of the target group substitution between subsidised and nonsubsidised workers negative duration dependence and the effectiveness of training the existence of the first two reduces the potential net benefit of the subsidy whereas that of the last two increases it analytically the problem is complex so a numerical simulation is conducted to provide insights into the interactions between these effects the nature of duration dependence is shown to be of crucial importance

willingness to pay estimates using the double bounded dichotomous choice contingent valuation format a test for validity and precision in a bayesian framework the double bounded dichotomous choice db dc contingent valuation format is thought to yield more precise welfare estimates questions remain about its validity the initial bid may represent information with which respondents update their willingness to pay a bayesian model of respondent decision making is estimated for two data sets the results indicate updating or shifts in respondent willingness to pay between iterated valuations nonparametric testing of the welfare estimates reveals that the model incorporating updating yields different values from the standard model the expected increases in the precision of the db dc welfare estimates are lost when updating occurs

matching and sorting in online dating using data on user attributes and interactions from an online dating site we estimate mate preferences and use the gale shapley algorithm to predict sta ble matches the predicted matches are similar to the actual matches achieved by the dating site and the actual matches are approximately efficient outof sample predictions of offline matches i e marriages exhibit assortative mating patterns similar to those observed in actual marriages thus mate pref erences without resort to search frictions can generate sorting in marriages however we underpredict some of the correlation patterns search frictions may play a role in explaining the discrepancy

multi trait matching and gender differentials in intergenerational mobility we describe a model of multi trait matching and inheritance in which individuals attractiveness in the marriage market depends on their market and non market characteristics gender differences in social mobility can arise if market characteristics are relatively more important in determining marriage outcomes for men than they are for women and if they are more persistent across generations than non market characteristics a reduction in gender based discrimination in the labor market increases homogamy in the marriage market and lowers social mobility for both genders

efficient estimation methods for closed ended contingent valuation surveys closed ended contingent valuation surveys can be very useful in the evaluation of nonmarket resources respondents merely state whether they would accept or reject a hypothetical threshold amount either as payment for giving up access to the resource or as a fee for its use the authors develop a maximum likelihood procedure which exploits the variation in the threshold values to allow direct and separate point estimates of regression like slope coefficients and error standard deviations without truncation bias their illustration uses data from a survey of recreational fisherman to examine factors which influence individuals willingness to pay copyright 1987 by mit press

option price estimates for water quality improvements a contingent valuation study for the monongahela river abstract we present the findings from a contingent valuation survey designed to estimate the option price bids for the improved recreation resulting from enhanced water quality in the pennsylvania portion of the monongahela river the findings are based on a survey design that used professional interviewers to conduct personal interviews determined from a representative sample of 393 households in addition the research suggests that protest bids and outliers be viewed similarly accordingly a new technique for identifying outlying responses is proposed the findings suggest that the question format affects the option price estimates and that criteria for determining the final sample of responses can have an important influence on contingent valuation results

identifying individual discount rates and valuing public open space with stated preference models an individual s rate of time preference is an important consideration for individuals deciding whether to support a public good since the benefits of a public good often come in the future our study finds individual discount rates from a contingent valuation method cvm question where the time frame of the payment schedule is varied across surveys we find discount rates similar to the rates found in the recent revealed preference and experimental literature of around 30 our cvm question addresses the preservation of additional open space adjacent to a large regional park at the urban fringe of portland oregon

measurement of health state utilities for economic appraisal health status measurement for use in economic appraisal of health care programmes is reviewed in this paper with particular emphasis on utility measurement a framework for economic appraisal is presented displaying the various components that must be measured and showing how the three forms of analysis cost effectiveness analysis cost benefit analysis and cost utility analysis relate to the framework and to each other one of the components in the framework is health status it can be measured using ad hoc numeric scales willingness to pay receive or health state utilities the determination of health state utilities is reviewed covering the following issues alternative sources of utilities health state descriptions multi attribute utility approach determination of appropriate subjects utility aggregation and accuracy three measurement techniques for health state utilities are described in detail rating scale standard gamble and time trade off the use of these methods is described for both chronic and temporary health states and for both health states considered better than death and those considered worse than death

insuring consumption against illness one of the most sizable and least predictable shocks to economic opportunities in developing countries is major illness we investigate the extent to which families are able to insure consumption against major illness using a unique panel data set from indonesia that combines excellent measures of health status with consumption information we find that there are significant economic costs associated with major illness and that there is very imperfect insurance of consumption over illness episodes these estimates suggest that public disability insurance or subsidies for medical care may improve welfare by providing consumption insurance

evaluating the validity of the dichotomous choice question format in contingent valuation hypothetical and actual cash willingness to pay wtp for an art print were elicited with dichotomous choice and open ended question formats comparing hypothetical and actual dichotomous choice responses using both a likelihood ratio test and the method of convolutions suggests we reject equality at the 0 05 but not the 0 01 level hypothetical wtp was roughly two times actual wtp with the dichotomous choice format there were no significant differences between the open ended and dichotomous choice question formats when both were used to estimate hypothetical wtp or both used to estimate actual wtp

tests of intrahousehold resource allocation using a cv framework a comparison of husbands and wives separate and joint wtp in the slums of navi mumbai india summary husbands and wives from 422 households in the slums of navi mumbai india were interviewed separately first and jointly thereafter in a contingent valuation framework to assess their individual and joint household willingness to pay wtp for malaria vaccines husbands and wives demand differed significantly when they were interviewed separately but not when they were interviewed jointly the author rejects the common preference model and unified bargaining model of intrahousehold resource allocation researchers should consider the complexity of intrahousehold decision making when they conduct stated preference surveys even in patriarchal societies

bias in discrete response contingent valuation abstract the empirical literature on discrete response contingent valuation has found that seemingly innocuous changes in the statistical models estimated result in significantly different point estimates of willingness to pay this paper hypothesizes and tests several potential explanations for these results first it investigates and compares the biases inherent in single bounded and double bounded maximum likelihood estimation procedures and examines how they react to various bid designs and sample sizes then it examines the presence and identification of outliers in binary choice data and how these outliers influence estimation finally it presents an alternative approach to addressing the issue of outliers which explicitly acknowledges the possibility of upwardly biased response probabilities

changing with the tide semiparametric estimation of preference dynamics we contrast the discovered preference hypothesis against the theory of coherent arbitrariness in a split sample stated choice experiment on flood risk exposure a semiparametric local multinomial logit model is developed as an alternative to the swait and louviere 1993 test procedure controlling for preference dynamics within and between samples the proposed model supports the discovered preference hypothesis by means of a decaying starting point bias the swait and louviere 1993 test procedure reaches a different conclusion it rejects the assumption of stable preferences but most preference dynamics tend to be smoothed out causing a more erratic pattern of preference dynamics

are hypothetical referenda incentive compatible a comment in a recent article in this journal cummings al 1997 offer experimental evidence rejecting the hypothesis that a hypothetical referendum is an incentive compatible mechanism for obtaining the social value of or willingness to pay for changes in the allocation of environmental goods and services while cautions in offering a blanket rejection of hypothetical referenda as a means of measuring economic values on the basis of their findings the authors do suggest that at least in experimental settings respondents appear to behave differently when real money is changing hands wheather hypothetical situations adequately mimic real market situations has been debated in the contigent valuation literature since its inception see cummings brookshire and schulze 1986 cummings et al s finding of incentive incompatibility appears to offer strong evidence for the critics of hypothetical referenda

a multilevel modelling approach to triple bounded dichotomous choice contingent valuation the use of dichotomous choice dc questions in the elicitation of willingness to pay wtp in contingent valuation studies is common practice at the present time recent research has shown that double bounded dc questions provide statistically superior results to single bounded questions given an appropriate sampling design this paper uses a relatively new multilevel modelling technique to analyze a triple bounded dc design which in addition includes an initial non monetary question on whether an individual accepts in principle a wtp some unspecified amount the theoretical basis of the multilevel model used is described and some of the possibilities of this potentially powerful and versatile technique are discussed the practical operation of the multilevel model is demonstrated using data from a contingent valuation study conducted in the norfolk broads england an internationally important wetland resource

repeated dichotomous choice formats for elicitation of willingness to pay simultaneous estimation and anchoring effect repeated dichotomous choice contingent valuation data are generated from responses to a succession of binary questions regarding alternative prices for an environmental good in this paper we propose a simultaneous equation model that allows for endogeneity and error correlation across the responses at each stage of the bidding process the model allows us to study the evolution of anchoring effects after the second dichotomous choice question estimation involves the bayesian techniques of gibbs sampling and data augmentation and the application focuses on the preservation value of a natural area the results for a data set involving up to four successive dichotomous choice questions show that restricted multiple bounded models are rejected by the data with the general model in addition willingness to pay tends to stabilize after the second stage in the elicitation process for the general unrestricted model when taking anchoring effects into consideration it is revealed that individuals responses in the latter stages are influenced by the sequence of bid prices offered in earlier questions nevertheless they do not have a significant effect on welfare estimates