Use of Contingent Valuation to Elicit Willingness-to-Pay for the Benefits of Developmental Health Risk Reductions

Stackelberg, Katherine von; Hammitt, James K.

doi:10.1007/s10640-009-9267-7

Cited by 19 publications

(14 citation statements)

References 30 publications

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“…Halkos and Matsiori [117] also reported that, as the level of income increases, people would be more willing to pay. Others studies using meta-analysis data had similar findings [129].…”

Section: Discussionmentioning

confidence: 60%

Determinants and Values of Willingness to Pay for Water Quality Improvement: Insights from Chia Lagoon, Malawi

2019

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Water resources in the Chia lagoon in Malawi experience a possible threat to sustainability. Communities are seeking alternatives to improve water quality in the lagoon. This study quantified the communities’ willingness-to-pay (WTP) and their influencing factors while using contingent valuation (CV) techniques. A wide range of data collection procedures, including focus group discussions, key informant interviews, field observation, and CV survey, were employed. A sample of 300 households was randomly selected. The CV results showed that 57.4% of the households were willing to pay. The monthly individual aggregate WTP amount ranged from MK696.83 (US$0.95) to MK81697 (US$111.38), and on average MK7870.45 (US$10.73), generating aggregate annual values ranging from MK6, 689,568 (US$9126.29) to MK784, 294,080 (US$1,069,978), and on average MK75,556,320 (US$103,078) (ceteris paribus). Logistic regression model demonstrated a significant (p < 0.01 or p < 0.05) relationship between demographic (gender, age, literacy level), social-economic (land ownership, main agriculture water source, and income), and institutional (civic education and social network, extension, institutional trust, household socio trust) factors and WTP. The findings from this study provide significant clues for further research and baseline information for local government and communities in the development of more effective and holistic approaches for improving water quality in natural ecosystems.

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“…Halkos and Matsiori [117] also reported that, as the level of income increases, people would be more willing to pay. Others studies using meta-analysis data had similar findings [129].…”

Section: Discussionmentioning

confidence: 60%

Determinants and Values of Willingness to Pay for Water Quality Improvement: Insights from Chia Lagoon, Malawi

2019

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“…One category of bads is environmental damage (Carson et al, 2003; Loureiro et al, 2009; von Stackelberg and Hammitt, 2009; Martin-Ortega et al, 2011). Another category includes a public good that benefits society but harms a host location, such as locating a prison or a toxic waste dump.…”

Section: Introductionmentioning

confidence: 99%

fMRI evidence of a hot-cold empathy gap in hypothetical and real aversive choices

Kang¹,

Camerer²

2013

Front. Neurosci.

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Hypothetical bias is the common finding that hypothetical monetary values for "goods" are higher than real values. We extend this research to the domain of "bads" such as consumer and household choices made to avoid aversive outcomes (e.g., insurance). Previous evidence of hot-cold empathy gaps suggest food disgust is likely to be strongly underestimated in hypothetical (cold) choice. Depending on relative underestimation of food disgust and pain of spending, the hypothetical bias for aversive bad scan go in the typical direction for goods, disappear, or reverse in sign. We find that the bias is reversed in sign-subjects pay more to avoid bads when choice is real. fMRI shows that real choice more strongly activates striatum and medial prefrontal cortex (reward regions) and shows distinct activity in insula and amygdala (disgust and fear regions). The neural findings suggest ways to exogeneously manipulate or record brain activity in order to create better forecasts of actual consumer choice.Keywords: hypothetical bias, aversive bads, fMRI, medial prefrontal cortex, amygdala, decision making, neuroeconomics INTRODUCTIONReal choices are binding consequential commitments to a course of action, like undergoing surgery or putting a down payment on a house. Researchers in all social sciences seek to understand how real choices are made. However, in studying decisions, scientists and policy makers often have to settle for measuring hypothetical statements about what people would choose, rather than observing what people actually do choose.In marketing research, for example, hypothetical surveys are used to forecast sales of existing products, to test new products by asking consumers what they would buy, and to evaluate promotions (Silk and Urban, 1978;Urban et al., 1983;Infosino, 1986;Jamieson and Bass, 1989;Green and Srinivasan, 1990;Chandon et al., 2004;Raghubir and Greenleaf, 2006;Schlosser et al., 2006). In public economics and political science, survey data are used to establish the dollar value of goods that are not traded in markets (such as clean air or the prevention of oil spills), and to poll likely voters before an election (Crespi, 1989;Diamond and Hausman, 1994;Carson et al., 1996;Mortimer and Segal, 2008). Hypothetical choices are also necessary in some types of psychology and neuroscience experiments in which measuring real choices is impractical or unethical, especially in the domain of distressing moral choices (Greene et al., 2001(Greene et al., , 2004Kühberger et al., 2002;Hariri et al., 2006;Monterosso et al., 2007).The reliance on hypothetical choice data presumes either that hypothetical choices are a good and legitimate way to forecast real choices, or that there is some knowable relationship between the two types of choices, such that the hypothetical data can be adjusted to forecast real choice data accurately.Abbreviations: WTP, willingness-to-pay; CS, consumer surplus.However, many studies in behavioral economics have shown a substantial, systematic gap: typically, hypothetical valuations ar...

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“…For a similar good, VonStackelberg and Hammitt (2009) used stated-preference methods to estimate parents' WTP to prevent a delay in reading attainment or an IQ deficit in their children associated with exposure to particular chemicals (PCBs) in the environment. Their findings suggest that WTP is small compared with estimates of the effect of lower IQ on lifetime earnings.…”

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confidence: 99%

Evaluating Willingness to Pay as a Measure of the Impact of Dyslexia in Adults

Herrera-Araujo

Shaywitz

Holahan

et al. 2017

J. Benefit Cost Anal.

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While much is known about dyslexia in school-age children and adolescents, less is known about its effects on quality of life in adults. Using data from the Connecticut Longitudinal Study we provide the first estimates of the monetary value of improving reading, speaking, and cognitive skills to dyslexic and nondyslexic adults. Using a stated-preference survey, we find that dyslexic and nondyslexic individuals value improvements in their skills in reading speed, reading aloud, pronunciation, memory, and information retrieval at about the same rate.Because dyslexics have lower self-reported levels on these skills, their total willingness to pay to achieve a high level of skill is substantially greater than for non-dyslexics. However, dyslexic individuals' willingness to pay (averaging $3000for an improvement in all skills simultaneously) is small compared with the difference in earnings between dyslexic and non-dyslexic adults. We estimate that dyslexic individuals earn 15 percent less per year (about $8000) than non-dyslexic individuals. Although improvements in reading, speaking and cognitive skills in adulthood are unlikely to eliminate the earnings difference that reflects differences in educational attainment and other factors, stated-preference estimates of the value of cognitive skills may substantially underestimate the value derived from effects on lifetime earnings and health.

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Use of Contingent Valuation to Elicit Willingness-to-Pay for the Benefits of Developmental Health Risk Reductions

Abstract: Contingent valuation, Developmental effects, IQ, PCBs, QALY, Risk assessment,

Cited by 19 publications

References 30 publications

Determinants and Values of Willingness to Pay for Water Quality Improvement: Insights from Chia Lagoon, Malawi

Determinants and Values of Willingness to Pay for Water Quality Improvement: Insights from Chia Lagoon, Malawi

fMRI evidence of a hot-cold empathy gap in hypothetical and real aversive choices

Evaluating Willingness to Pay as a Measure of the Impact of Dyslexia in Adults

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