Hostname: page-component-745bb68f8f-d8cs5 Total loading time: 0 Render date: 2025-01-09T14:07:05.833Z Has data issue: false hasContentIssue false
  • English
  • Français

Sensitivity of WTP Estimates to Definition of ‘Yes’: Reinterpreting Expressed Response Intensity

Published online by Cambridge University Press:  15 September 2016

Mimako Kobayashi ,
Kimberly Rollins  and
M. D. R. Evans
Mimako Kobayashi
Affiliation:
Department of Resource Economics
Kimberly Rollins
Affiliation:
Department of Resource Economics
M. D. R. Evans
Affiliation:
Department of Resource Economics and the Department of Sociology, at the University of Nevada, Reno, in Reno, Nevada
Get access Rights & Permissions [Opens in a new window]

Abstract

Willingness to pay (WTP) estimation typically involves some strategy for mapping nondichotomous contingent valuation (CV) responses onto a dichotomous yes/no dependent variable. We propose a new approach to selecting which responses qualify as ‘yes.’ We apply the proposed method to polychotomous CV data for preventative land management programs in the Great Basin. We also estimate WTP using other methods of response recoding found in the literature. By contrasting the results under different approaches, we demonstrate how and why WTP point estimates vary across recoding methods and discuss the comparative advantages of our more generalized recoding approach that is based on predicted probabilities of ‘yes’ responses.

Keywords

contingent valuationGreat Basininvasive weedsland managementpolychotomous formatresponse intensityresponse mappingwildfire
Type
Contributed Papers
Information
Agricultural and Resource Economics Review , Volume 39 , Issue 1 , February 2010 , pp. 37 - 55
Copyright
Copyright © 2010 Northeastern Agricultural and Resource Economics Association 

Access options

Get access to the full version of this content by using one of the access options below. (Log in options will check for institutional or personal access. Content may require purchase if you do not have access.)

References

Aadland, D., and Caplan, A.J. 2006. “Curbside Recycling: Waste Resource or Waste of Resources?” Journal of Policy Analysis and Management 25(4): 855–874.CrossRefGoogle Scholar
Akter, S., Brower, R., Brander, L., and Van Beukering, P. 2009. “Respondent Uncertainty in a Contingent Market for Carbon Offsets.” Ecological Economics 68(6): 1858–1863.CrossRefGoogle Scholar
Albaum, G., Roster, C., Yu, J.H., and Rogers, R.D. 2007. “Simple Rating Scale Formats: Exploring Extreme Response.” International Journal of Market Research 49(5): 1–17.CrossRefGoogle Scholar
Alberini, A., Boyle, K., and Welsh, M. 2003. “Analysis of Contingent Valuation Data with Multiple Response Options Allowing Respondents to Express Uncertainty.” Journal of Environmental Economics and Management 45(1): 40–62.CrossRefGoogle Scholar
Ariely, D., Loewenstein, G., and Prelec, D. 2006. “Tom Sawyer and the Construction of Value.” Journal of Economics Behavior and Organization 60(1): 1–10.CrossRefGoogle Scholar
Bateman, I.J., Burgess, D., and Hutchinson, W.G. 2008. “Learning Design Contingent Valuation (LDCV): NOAA guidelines, preference learning and coherent arbitrariness.” Journal of Environmental Economics and Management 55(2): 127–141.CrossRefGoogle Scholar
Bishop, G.F. 1987. “Experiments with the Middle Response Alternative in Survey Questions.” The Public Opinion Quarterly 51(2): 220–232.CrossRefGoogle Scholar
Blumenschein, K., Blomquist, G., Johannesson, M., Horn, N., and Freeman, R. 2008. “Eliciting Willingness to Pay without Bias: Evidence from a Field Experiment.” The Economic Journal 118(525): 114–137.CrossRefGoogle Scholar
Bollen, K.A. 1989. Structural Equations with Latent Variables. New York: Wiley-Interscience.CrossRefGoogle Scholar
Boxall, R, Rollins, K., and Englin, J. 2003. “Heterogeneous Preferences for Congestion during a Wilderness Experience.” Resource and Energy Economics 25(2): 177–195.CrossRefGoogle Scholar
Broberg, T., and Brannlund, R. 2008. “An Alternative Interpretation of Multiple Bounded WTP Data—Certainty Dependent Payment Card Intervals.” Resource and Energy Economics 30(4): 555–567.CrossRefGoogle Scholar
Bureau of Land Management (BLM). 1999. “Out of Ashes, an Opportunity.” National Interagency Fire Center, Boise, ID, p. 36. Available at http://www.blm.gov/pgdata/etc/medialib/blm/id/fire/gbri/documents.Par.5395.File.dat/Ashes.pdf (accessed January 11, 2010).Google Scholar
Bureau of Land Management (BLM). 2000. “The Great Basin: Healing the Land.” National Interagency Fire Center, Boise, ID, p. 28. Available from Bureau of Land Management, 1340 Financial Blvd, Reno, Nev, 89520-0006 (775/861-6400).Google Scholar
Cameron, T., and Englin, J. 1997. “Welfare Effects of Changes in Environmental Quality under Individual Uncertainty about Use.” Rand Journal of Economics 28(0): S45–70.CrossRefGoogle Scholar
Cantril, H. 1946. “The Intensity of an Attitude.” Journal of Abnormal and Social Psychology 41(2): 129–135.CrossRefGoogle Scholar
Carroll, R., Carroll, J., Ruppert, D., and Stefanski, L.A. 2006. Measurement Error in Nonlinear Models: A Modern Perspective (2nd edition). New York: Chapman & Hall/CRC.CrossRefGoogle Scholar
Carson, R.T., Hanemann, W.M., Kopp, R.J., Krosnick, J.A., Mitchell, R.C., Presser, S., Ruud, P.A., Smith, V.K., Conaway, M., and Martin, K. 1998. “Referendum Design and Contingent Valuation: The NOAA Panel's No-Vote Recommendation.” The Review of Economics and Statistics 80(2): 335–338.CrossRefGoogle Scholar
Chambers, J., Roundy, B.A., Blank, R.R., Meyer, S.E., and Whitaker, A. 2007. “What Makes Great Basin Sagebrush Ecosystems Invasible by Bromus tectorum? ” Ecological Monographs 77(1): 117–145.CrossRefGoogle Scholar
Champ, P.A., and Bishop, R.C. 2001. “Donation Payment Mechanisms and Contingent Valuation: An Empirical Study of Hypothetical Bias.” Environmental and Resource Economics 19(4): 383–402.CrossRefGoogle Scholar
Champ, P.A., Bishop, R.C., Brown, T.C., and McCollum, D.W. 1997. “Using Donation Mechanisms to Value Nonuse Benefits from Public Goods.” Journal of Environmental Economics and Management 33(2): 151–162.CrossRefGoogle Scholar
Champ, P., Alberini, A., and Correas, C. 2005. “Using Contingent Valuation to Value a Noxious Weeds Control Program: The Effects of Including an Unsure Response Category.” Ecological Economics 55(1): 47–60.CrossRefGoogle Scholar
Crandall, J.E. 1965. “Some Relationships among Sex, Anxiety, and Conservatism of Judgment.” Journal of Personality 33(1): 99–107.CrossRefGoogle Scholar
Caudill, S., and Groothuis, P. 2005. “Modeling Hidden Alternatives in Random Utility Models: An Application to ‘Don't Know’ Responses in Contingent Valuation.” Land Economics 81(3): 445–454.CrossRefGoogle Scholar
DeShazo, J.R. 2002. “Designing Transactions without Framing Effects in Iterative Question Formats.” Journal of Environmental Economics and Management 43(3): 360–385.CrossRefGoogle Scholar
DeShazo, J.R., and Fermo, G. 2002. “Designing Choice Sets of Stated Preference Methods: The Effects of Complexity on Choice Consistency.” Journal of Environmental Economics and Management 44(1): 123–143.CrossRefGoogle Scholar
Devine, R. 1993. “The Cheatgrass Problem”. The Atlantic 271(5): 40–48.Google Scholar
Dillman, D. A. 2000. Mail and Internet Surveys: The Tailored Design Method (2nd edition). New York: Wiley.Google Scholar
Elliot, M.N., Haviland, A.M., Kanouse, D.E., Hambarsoomian, K., and Hays, R.D. 2009. “Adjusting for Subgroup Differences in Extreme Response Tendency in Ratings of Health Care: Impact on Disparity Estimates.” Health Research and Educational Trust 44(2): 542–561.Google Scholar
Fuller, W.A. 1986. Measurement Error Models. New York: Wiley.Google Scholar
Greenleaf, E.A. 1992. “Extreme Response Style.” The Public Opinion Quarterly 56(3): 328–351.CrossRefGoogle Scholar
Groothius, P., and Whitehead, J. 2002. “Does Don't Know Mean No? Analysis of Don't Know Responses in Dichotomous Choice Contingent Valuation Questions.” Applied Economics 34(15): 1935–1940.CrossRefGoogle Scholar
Groves, R.M. 1991. “Measurement Error across Disciplines.” In Biemer, P.P., Groves, R.M., Lyberg, L.E., Mathiowetz, N.A., and Sudman, S., eds., Measurement Errors in Surveys. New York: Wiley.Google Scholar
Haener, M., and Adamowicz, W. 1998. “Analysis of ‘Don't Know’ Responses to Referendum Contingent Valuation Questions.” Agricultural and Resource Economics Review 27(2): 218–230.CrossRefGoogle Scholar
Hamilton, D.L. 1968. “Personality Attributes Associated with Extreme Response Style.” Psychological Bulletin 69(3): 192–203.CrossRefGoogle Scholar
Hanemann, W.M. 1984. “Welfare Estimation in Contingent Valuation Experiments with Discrete Responses.” American Journal of Agricultural Economics 66(3): 332–341.CrossRefGoogle Scholar
Hui, C.H., and Triandis, H.C. 1985. “The Instability of Response Sets.” Public Opinion Quarterly 49(2): 253–260.CrossRefGoogle Scholar
Kelley, J. (1973). “Causal Chain Models for the Socioeconomic Career.” American Sociological Review 38(4): 481–493.CrossRefGoogle Scholar
Kohn, M.L., and Schooler, C. 1978. “The Reciprocal Effects of the Substantive Complexity of Work and Intellectual Flexibility: A Longitudinal Assessment.” American Journal of Sociology 84(1): 24–52.CrossRefGoogle Scholar
Krosnick, J.A. 1991. “Response Strategies for Coping with the Cognitive Demands of Attitude Measures in Surveys.” Applied Cognitive Psychology 5(3): 213–236.CrossRefGoogle Scholar
Krosnick, J.A. 1999. “Survey Research.” Annual Review of Psychology 50(1): 537–567.CrossRefGoogle Scholar
Krosnick, J.A., Judd, C.M., and Wittenbrink, B. 2005. “The Measurement of Attitudes.” In Albarraci, D., Johnson, B.T., and Zanna, M.P., eds., The Handbook of Attitudes. Mahwah, NJ: Erlbaum.Google Scholar
Lewis, N.A., and Taylor, J.A. 1955. “Anxiety and Extreme Response Preferences.” Educational and Psychological Measurement 15(2): 111–116.CrossRefGoogle Scholar
Li, C., and Mattsson, L. 1995. “Discrete Choice under Preference Uncertainty: An Improved Structural Model for Contingent Valuation.” Journal of Environmental Economics and Management 28(2): 256–269.CrossRefGoogle Scholar
Loomis, J., and Ekstrand, E. 1998. “Alternative Approaches for Incorporating Respondent Uncertainty when Estimating Willingness to Pay: The Case of the Mexican Spotted Owl.” Ecological Economics 21(1): 29–41.CrossRefGoogle Scholar
Miller, J., Slomczynski, K.M., and Kohn, M.L. 1985. “Continuity of Learning-Generalization.” American Journal of Sociology 91(3): 593–615.CrossRefGoogle Scholar
Mozumder, P., and Berrens, R.P. 2007. “Investigating Hypothetical Bias: Induced-Value Tests of the Referendum Voting Mechanisms with Uncertainty.” Applied Economics Letters 14(10): 705–709.CrossRefGoogle Scholar
Naemi, B.D., Beal, D.J., and Payne, S.C. 2009. “Personality Predictors of Extreme Response Style.” Journal of Personality 77(1): 261–286.CrossRefGoogle Scholar
NOAA. 1993. “National Oceanographic and Atmospheric Administration, Appendix I: Report of the NOAA Panel on Contingent Valuation.” Federal Register 58: 4602–4614.Google Scholar
Ready, R., Navrud, S., and Dubourg, W.R. 2001. “How Do Respondents with Uncertain Willingness to Pay Answer Contingent Valuation Questions?” Land Economics 77(3): 315–326.CrossRefGoogle Scholar
Ready, R., Whitehead, J., and Blomquist, G. 1995. “Contingent Valuation When Respondents Are Ambivalent.” Journal of Environmental Economics and Management 29(2): 181–196.CrossRefGoogle Scholar
Rollins, K., Dumitras, D., and Castledine, A. 2008. “An Analysis of Congestion Effects across and within Multiple Recreation Activities.” Canadian Journal of Agricultural Economics 56(1): 95–116.CrossRefGoogle Scholar
Rollins, K.S., Kobayashi, M., Evans, M.D.R., and Castledine, A. 2009. “Willingness to Pay Estimation When Protest Beliefs Are Inseparable from the Public Good Definition.” Working Paper, Department of Resource Economics, University of Nevada, Reno. A copy of this paper is on file with the authors.Google Scholar
Samnaliev, M., Stevens, T.H., and More, T. 2006. “A Comparison of Alternative Certainty Calibration Techniques in Contingent Valuation.” Ecological Economics 57(3): 507–519.CrossRefGoogle Scholar
Shaikh, S.L., Sun, L., and van Kooten, G.C. 2007. “Treating Respondent Uncertainty in Contingent Valuation: A Comparison of Empirical Treatments.” Ecological Economics 62(1): 115–125.CrossRefGoogle Scholar
Schwarz, N., and Sudman, S. 1995. Answering Questions: Methodology for Determining Cognitive and Communicative Processes in Survey Research. New York: Jossey Bass.Google Scholar
Tourangeau, R., Rips, L.J., and Rasinski, K.A. 2000. The Psychology of Survey Response. New York: Cambridge University Press.CrossRefGoogle Scholar
Vossler, C.A., Poe, G.L., Welsh, M.P., and Ethier, R.G. 2004. “Bid Design Effects in Multiple Bounded Discrete Choice Contingent Valuation.” Environmental and Resource Economics 29(4): 401–418.CrossRefGoogle Scholar
Wang, H. 1997. “Treatment of ‘Don't Know’ Responses in Contingent Valuation Surveys: A Random Valuation Model.” Journal of Environmental Economics and Management 32(2): 219–232.CrossRefGoogle Scholar
Welsh, M., and Poe, G. 1998. “Elicitation Effects in Contingent Valuation: Comparisons to a Multiple Bounded Discrete Choice Approach.” Journal of Environmental Economics and Management 36(2): 170–185.CrossRefGoogle Scholar
Whitehead, J., Blomquist, G., Ready, R., and Huang, J. 1998. “Construct Validity and Polychotomous Choice Contingent Valuation Questions.” Environmental and Resource Economics 11(1): 107–116.CrossRefGoogle Scholar