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Asking Willingness-to-Accept Questions in Stated Preference Surveys: A Review and Research Agenda

Author

Listed:
  • Dale Whittington

    (Department of Environmental Sciences and Engineering and Department of City and Regional Planning, University of North Carolina, Chapel Hill, North Carolina 27559)

  • Wiktor Adamowicz

    (Department of Resource Economics and Environmental Sociology, University of Alberta, Edmonton, Alberta T6G 2P5, Canada)

  • Patrick Lloyd-Smith

    (Department of Resource Economics and Environmental Sociology, University of Alberta, Edmonton, Alberta T6G 2P5, Canada)

Abstract

Stated preference (SP) researchers have encountered an increasing number of policy problems for which a willingness-to-accept (WTA) compensation question would seem to be the most reasonable approach to structure the respondent's valuation choice task. However, most SP researchers are still reluctant to pose WTA questions to respondents due to concerns about reliability of responses and confusion about what contexts warrant a WTA question compared to a willingness-to-pay question. This review synthesizes the current literature, provides guidance on when and how to use WTA elicitation formats, and identifies research needs. We present a typology of valuation tasks that illustrates the situations in which WTA questions are appropriate and should be used to estimate welfare-theoretic measures of economic benefits—and when they should be avoided. We also discuss three different design issues that SP researchers need to consider when they use WTA questions: (a) elicitation of reference and status quo conditions, (b) incentive compatibility and private versus public goods, and (c) nonconforming responses. We conclude that good survey design makes it possible to ask respondents sensible WTA questions in many cases, yet several key research issues require attention.

Suggested Citation

  • Dale Whittington & Wiktor Adamowicz & Patrick Lloyd-Smith, 2017. "Asking Willingness-to-Accept Questions in Stated Preference Surveys: A Review and Research Agenda," Annual Review of Resource Economics, Annual Reviews, vol. 9(1), pages 317-336, October.
    • Handle: RePEc:anr:reseco:v:9:y:2017:p:317-336
    DOI: 10.1146/annurev-resource-121416-125602
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    Citations

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    Cited by:

    1. Maldonado, Jorge H. & Moreno-Sánchez, Rocío del Pilar & Espinoza, Sophía & Bruner, Aaron & Garzón, Natalia & Myers, John, 2018. "Peace is much more than doves: The economic benefits of bird-based tourism as a result of the peace treaty in Colombia," World Development, Elsevier, vol. 106(C), pages 78-86.
    2. Alix-Garcia, Jennifer M. & Sims, Katharine R.E. & Phaneuf, Daniel J., 2019. "Using referenda to improve targeting and decrease costs of conditional cash transfers," Journal of Public Economics, Elsevier, vol. 176(C), pages 179-194.
    3. Céline Nauges & Dale Whittington, 2019. "Social Norms Information Treatments in the Municipal Water Supply Sector: Some New Insights on Benefits and Costs," Water Economics and Policy (WEP), World Scientific Publishing Co. Pte. Ltd., vol. 5(03), pages 1-40, July.
    4. Lloyd-Smith, Patrick & Adamowicz, Wiktor, 2018. "Can stated measures of willingness-to-accept be valid? Evidence from laboratory experiments," Journal of Environmental Economics and Management, Elsevier, vol. 91(C), pages 133-149.
    5. Grilli, Gianluca & Notaro, Sandra & Campbell, Danny, 2018. "Including Value Orientations in Choice Models to Estimate Benefits of Wildlife Management Policies," Ecological Economics, Elsevier, vol. 151(C), pages 70-81.
    6. Ambika Markanday & Ibon Galarraga & Anil Markandya, 2019. "A Critical Review Of Cost-Benefit Analysis For Climate Change Adaptation In Cities," Climate Change Economics (CCE), World Scientific Publishing Co. Pte. Ltd., vol. 10(04), pages 1-31, November.
    7. Perni, Ángel & Barreiro-Hurlé, Jesús & Martínez-Paz, José Miguel, 2020. "When policy implementation failures affect public preferences for environmental goods: Implications for economic analysis in the European water policy," Ecological Economics, Elsevier, vol. 169(C).
    8. Vanessa Bonke & Marius Michels & Oliver Musshoff, 2021. "Will Farmers Accept Lower Gross Margins for the Sustainable Cultivation Method of Mixed Cropping? First Insights from Germany," Sustainability, MDPI, vol. 13(4), pages 1-13, February.

    More about this item

    Keywords

    stated preferences; willingness to accept; willingness to pay; contingent valuation; choice experiments; hypothetical baselines; domain of gains; domain of losses;
    All these keywords.

    JEL classification:

    • D61 - Microeconomics - - Welfare Economics - - - Allocative Efficiency; Cost-Benefit Analysis
    • H43 - Public Economics - - Publicly Provided Goods - - - Project Evaluation; Social Discount Rate
    • Q51 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Valuation of Environmental Effects

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