Accessibility navigation


Bayesian estimation of willingness-to-pay where respondents mis-report their preferences

Balcombe, K., Bailey, A., Chalak, A. and Fraser, I. (2007) Bayesian estimation of willingness-to-pay where respondents mis-report their preferences. Oxford Bulletin of Economics and Statistics, 69 (3). pp. 413-437. ISSN 0305-9049

Full text not archived in this repository.

It is advisable to refer to the publisher's version if you intend to cite from this work. See Guidance on citing.

To link to this item DOI: 10.1111/j.1468-0084.2006.00198.x

Abstract/Summary

We introduce a modified conditional logit model that takes account of uncertainty associated with mis-reporting in revealed preference experiments estimating willingness-to-pay (WTP). Like Hausman et al. [Journal of Econometrics (1988) Vol. 87, pp. 239-269], our model captures the extent and direction of uncertainty by respondents. Using a Bayesian methodology, we apply our model to a choice modelling (CM) data set examining UK consumer preferences for non-pesticide food. We compare the results of our model with the Hausman model. WTP estimates are produced for different groups of consumers and we find that modified estimates of WTP, that take account of mis-reporting, are substantially revised downwards. We find a significant proportion of respondents mis-reporting in favour of the non-pesticide option. Finally, with this data set, Bayes factors suggest that our model is preferred to the Hausman model.

Item Type:Article
Refereed:Yes
Divisions:Faculty of Life Sciences > School of Agriculture, Policy and Development
ID Code:8273
Uncontrolled Keywords:CHOICE CONTINGENT VALUATION, LOGIT MODEL, RESPONSES, UNCERTAINTY

University Staff: Request a correction | Centaur Editors: Update this record

Page navigation