An earlier draft of this article was presented at the iHEA 5th World Congress held July 10–13, 2005 in Barcelona. We are grateful to Jason Shogren and Laura Taylor for detailed suggestions on the design of our experiment and the cheap talk script. For comments, we thank Richard Bishop, Patricia Champ, Tommy Gärling, Glenn Harrison, John List, John Whitehead, Kip Viscusi, seminar participants at the University of Connecticut and Appalachian State University, Editor Leonardo Felli, and three anonymous referees. We also thank Niklas Zethraeus for research assistance and Ronald Langley for suggestions about certainty statements. Finally, we are indebted to the American Pharmacy Services Corporation and the following pharmacists who participated in this experiment: Matt Cull, Drane Stephens, Aaron McIntosh, Kathy Salyer, Steve and Alicia Dawson, Gary Hamm, Alyson and Leon Claywell, Jason Wallace and Melodie Hawkins. This research was supported by Cooperative Agreement Number E11/CCE421825 from the Centers for Disease Control and Prevention (CDC). Views and contents are solely the responsibility of the authors and do not necessarily represent the official views of CDC. Magnus Johannesson received financial support from the Swedish Research Council.
Eliciting Willingness to Pay Without Bias: Evidence from a Field Experiment*
Article first published online: 20 DEC 2007
The Economic Journal
Volume 118, Issue 525, pages 114–137, January 2008
How to Cite
Blumenschein, K., Blomquist, G. C., Johannesson, M., Horn, N. and Freeman, P. (2008), Eliciting Willingness to Pay Without Bias: Evidence from a Field Experiment. The Economic Journal, 118: 114–137. doi: 10.1111/j.1468-0297.2007.02106.x
- Issue published online: 20 DEC 2007
- Article first published online: 20 DEC 2007
- Submitted: 23 February 2005 Accepted: 17 July 2006
Concern exists that hypothetical willingness to pay questions overestimate real willingness to pay. In a field experiment, we compare two methods of removing hypothetical bias, a cheap talk approach and a certainty approach, with real purchases. We find evidence of hypothetical bias for unadulterated contingent valuation. Contingent valuation with certainty statements removes the hypothetical bias, but the cheap talk approach has no significant impact. Our findings suggest that willingness to pay can be accurately estimated by adding a simple follow-up question about the certainty of responses and that cheap talk is not a generally effective approach.