INTRODUCTION

Imagine that you are a member of a management team at the Environmental Protection Agency (EPA) charged with allocating scarce resources to alternative environmental management interventions. As part of your efforts, you need to establish the value of potential natural resource benefits achieved from different proposed interventions. To help in that valuation exercise you seek information about public values for different levels of these natural resources; obtaining citizen inputs is a natural extension of the principles of democratic governance (see Gregory et al., 1997, for a discussion of this position). One method that you consider for getting such information about public values is to conduct a contingent valuation (CV) study of peoples' preferences for different levels of an environmental resource (for a general review of CV studies, see Mitchell & Carson, 1989). Those expressions of preferences will be used as inputs to design and select among alternative environmental management interventions.

Alternatively, imagine that you are the marketing manager for a new product and have been asked to generate a prediction regarding the likely sales of that product. The need to make such predictions is becoming both more important and more difficult because of rapid changes in technology and shortened product lives. You consider asking a sample of consumers to express their preference for your product in comparison with other competitor products that are, or might be, in the marketplace. Those expressions of preference will be used to predict future sales of your product.