Resolvable and Near‐epistemic Uncertainty in Stated Preference for Olive Oil: An Empirical Exploration

We elicit subjective probabilities of choice using a choice experiment designed to study preferences of German consumers for high quality Italian extra‐virgin olive oils. We develop an econometric framework to address the issues of resolvable and near‐epistemic uncertainty. Focussing on behaviourally meaningful quantities linked to changes in oil attributes, such as marginal probabilities and marginal willingness to pay, we found estimates of these quantities to be robust to both types of uncertainty from both discrete and fractional elicitation formats of the response variable. The frequency and presence of potentially near‐epistemic responses are explained by socio‐economic covariates, but their effects are not always in the same direction as in models of heteroskedastic choice, suggesting the existence of different sources. Rounding behaviour in subjective probabilities statements conforms with previous findings in the literature.