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

Research output: Contribution to journalArticle

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.

Bibliographical metadata

Original languageEnglish
Pages (from-to)317-336
Number of pages19
JournalAnnual Review of Resource Economics
Volume9
Early online date11 Jul 2017
DOIs
Publication statusPublished - Oct 2017