External Validity of Contingent Valuation: Comparing Hypothetical and Actual Payments.


Ryan, M; Mentzakis, E; Jareinpituk, S; Cairns, J; (2016) External Validity of Contingent Valuation: Comparing Hypothetical and Actual Payments. Health economics. ISSN 1057-9230 DOI: https://doi.org/10.1002/hec.3436

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Abstract

Whilst contingent valuation is increasingly used in economics to value benefits, questions remain concerning its external validity that is do hypothetical responses match actual responses? We present results from the first within sample field test. Whilst Hypothetical No is always an Actual No, Hypothetical Yes exceed Actual Yes responses. A constant rate of response reversals across bids/prices could suggest theoretically consistent option value responses. Certainty calibrations (verbal and numerical response scales) minimise hypothetical-actual discrepancies offering a useful solution. Helping respondents resolve uncertainty may reduce the discrepancy between hypothetical and actual payments and thus lead to more accurate policy recommendations. Copyright © 2016 John Wiley & Sons, Ltd.

Item Type: Article
Faculty and Department: Faculty of Public Health and Policy > Dept of Health Services Research and Policy
PubMed ID: 27723173
Web of Science ID: 412194700010
URI: http://researchonline.lshtm.ac.uk/id/eprint/2997211

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