Varying levels of information and the embedding problem in contingent valuation: the case of Canadian wilderness

1996 ◽  
Vol 26 (7) ◽  
pp. 1295-1303 ◽  
Author(s):  
Heather Macdonald ◽  
Daniel McKenney
Keyword(s):  
Willingness To Pay ◽  
Contingent Valuation ◽  
Information Provision ◽  
Complete Information ◽  
Background Information ◽  
Embedding Problem ◽  
Monetary Value ◽  
Nonmarket Goods ◽  
The Difference

This study examines the effect of providing varying amounts of information and embedding to contingent valuation respondents in the context of wilderness reservation. Contingent valuation is a technique developed to assess the monetary value of nonmarket goods by asking survey respondents how much they would be willing to pay (or accept) for an increase (or decrease) in the level of provision of such goods. Embedding refers to obtaining willingness-to-pay measures for a good when it is valued as part of a larger good. When subjects were provided with more complete information to make evaluations, their willingness-to-pay responses were reasonably consistent across levels of embedding. In contrast, when little background information was provided, willingness-to-pay amounts were inconsistent and showed significantly more variability and greater signs of embedding. In addition, low-information subjects volunteered more protest zeros and reported feeling slightly less confident of their responses. Perhaps the most interesting finding was the difference in mean valuations depending on how much background information subjects received. This issue of information provision can be a problematic challenge for contingent-valuation practitioners.

scholarly journals Contingent Valuation: From Dubious to Hopeless

2012 ◽  
Vol 26 (4) ◽  
pp. 43-56 ◽  
Author(s):  
Jerry Hausman
Keyword(s):  
Willingness To Pay ◽  
Contingent Valuation ◽  
Response Bias ◽  
Willingness To Accept ◽  
Embedding Problem ◽  
Contingent Valuation Study ◽  
Empirical Results ◽  
Valuation Study ◽  
Contingent Valuation Methods

Approximately 20 years ago, Peter Diamond and I wrote an article for this journal analyzing contingent valuation methods. At that time Peter's view was that contingent valuation was hopeless, while I was dubious but somewhat more optimistic. But 20 years later, after millions of dollars of largely government-funded research, I have concluded that Peter's earlier position was correct and that contingent valuation is hopeless. In this paper, I selectively review the contingent valuation literature, focusing on empirical results. I find that three long-standing problems continue to exist: 1) hypothetical response bias that leads contingent valuation to overstatements of value; 2) large differences between willingness to pay and willingness to accept; and 3) the embedding problem which encompasses scope problems. The problems of embedding and scope are likely to be the most intractable. Indeed, I believe that respondents to contingent valuation surveys are often not responding out of stable or well-defined preferences, but are essentially inventing their answers on the fly, in a way which makes the resulting data useless for serious analysis. Finally, I offer a case study of a prominent contingent valuation study done by recognized experts in this approach, a study that should be only minimally affected by these concerns but in which the answers of respondents to the survey are implausible and inconsistent.

scholarly journals Consumer willingness-to-pay for restaurant surcharges to reduce carbon emissions: default and information effects

2021 ◽  
pp. 1-29
Author(s):  
Dede Long ◽  
Grant H. West ◽  
Rodolfo M. Nayga
Keyword(s):  
Climate Change ◽  
Willingness To Pay ◽  
Contingent Valuation ◽  
Carbon Emissions ◽  
Emission Reduction ◽  
Carbon Emission ◽  
Dichotomous Choice ◽  
Carbon Reduction ◽  
The Mean ◽  
Agriculture And Food

Abstract The agriculture and food sectors contribute significantly to greenhouse gas emissions. About 15 percent of food-related carbon emissions are channeled through restaurants. Using a contingent valuation (CV) method with double-bounded dichotomous choice (DBDC) questions, this article investigates U.S. consumers’ willingness to pay (WTP) for an optional restaurant surcharge in support of carbon emission reduction programs. The mean estimated WTP for a surcharge is 6.05 percent of an average restaurant check, while the median WTP is 3.64 percent. Our results show that individuals have a higher WTP when the surcharge is automatically added to restaurant checks. We also find that an information nudge—a short climate change script—significantly increases WTP. Additionally, our results demonstrate that there is heterogeneity in treatment effects across consumers’ age, environmental awareness, and economic views. Our findings suggest that a surcharge program could transfer a meaningful amount of the agricultural carbon reduction burden to consumers that farmers currently shoulder.

Willingness to pay for more sustainable e-waste management: a contingent valuation study in greece

2012 ◽  
pp. 19-35
Author(s):  
Charisios Achillas ◽  
Christos Vlachokostas ◽  
Avraam Karagiannidis ◽  
Eftichios Sophocles Sartzetakis ◽  
Nicolas Moussiopoulos
Keyword(s):  
Waste Management ◽  
Willingness To Pay ◽  
Contingent Valuation ◽  
Local Community ◽  
Industrial Ecology ◽  
Contingent Valuation Study ◽  
Adequate Funding ◽  
Weee Recycling ◽  
Valuation Study ◽  
Environmentally Sound

Management of Waste Electric and Electronic Equipment (WEEE also called e-waste) has become an issue of critical importance recently also in the frame of industrial ecology besides waste management per se, mostly due to their content in hazardous materials and the extensive implications of any intervention in a broad industrial spectrum. The effectiveness of any landfill diversion scheme depends on its acceptance by the local community and the industry, as well as adequate funding. This paper presents a contingent valuation approach in order to examine public environmental awareness and to assess the willingness-to-pay (WTP) for the environmentally sound management of WEEE in Greece, based on a suitable, customized and easy-to-comprehend questionnaire. The survey revealed a still relative public ignorance on the subject and a reluctantly limited WTP. The latter is mostly triggered by the fact that respondents believed that associated expenses should be covered either by authorities or manufacturers (protest votes). However, based on the responses of those declaring a positive WTP, the average fee respondents are willing to pay exceeds the current recycling fee. Thus, existing recycling fees could be potentially increased in order to cover additional expenses for the development of infrastructure in areas not currently included in the national WEEE recycling program, as well as to provide the public with a dense network of disposal sites/bins in an effort to boost participation and WEEE recycling rates.

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