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The effects of presentation formats in choice experiments

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Abstract

Although stated-preference surveys take various forms, the use of either text or visuals to represent attributes is uncontroversial and remain commonly used. While prior research has investigated the impact of these formats in other disciplines, little is known about their effects in terms of relative importance in environmental economics. We conduct surveys on households’ preferences for water efficient technologies in South Africa, where we compare three presentation formats, namely text, visuals, and both text and visuals. Survey data collected from 894 households in the Gauteng Province are analysed using the mixed-logit model to test whether these three formats generate differences in estimated utilities and marginal willingness-to-pay (MWTP). This research sheds light on how to develop a valid presentation method for attribute levels in choice experiments, which is critical considering most environmental economics goods and services are not traded in the market. Our results obtained from the various presentation methods differ. There were also differences in MWTP estimates between the three groups. This suggests that the presentation format has significant impacts on choice. Thus, more research on presentation formats in environmental economics is warranted.

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Notes

  1. We agree that the technologies chosen as levels may also be used as attributes in other studies. However, in the context of our study the emphasis is on the areas in a home where households can save water by installing efficient technologies (i.e., kitchen, shower, toilet and outdoor). As such, water-efficient devices that can be fitted in these areas are used as levels in our choice experiment.

  2. As of the 24th of October 2018, US$1 = ZAR14.30.

  3. The survey provided respondents with background information about water conservation technologies and descriptions of the four-core water efficient technological elements (i.e., attributes and their associated levels) before they received six choice cards. The use of electronic gadgets as survey instruments as opposed to traditional paper-based improves realism of scenarios and provides a sense of the water-efficient technologies.

  4. As pointed out by one of the anonymous reviewers, it would not be possible for example simply by observing the images without the facilitation of texts for a respondent to know that the dishwasher (option 1) is an efficient one, nor to know that the showerhead in option 2 is efficient. This became apparent during piloting, hence respondents were made aware of the water-efficient technologies characterising the dishwasher, shower-head and the tap as part of their background information (i.e., Table 1).

  5. It is important to note that the three questionnaires used in this study only differed in the formats used to present the choice experiment section. The information presented was similar across all three questionnaires.

  6. Given that the survey was not simultaneously undertaken, the choice questions were presented in randomised order to reduce the potential biases from a respondent in the respective areas informing other respondents either in the same area or another about what to expect.

  7. Compared to other studies, MWTP for the three survey versions are very low. As pointed out by one of the reviewers, in the case of the present paper, the fixed costs or prices of the water-efficient technologies constitute a crucial attribute that is not manifested in the design. It is possible that some respondent may therefore find it hard to choose if the prices of the water-efficient technologies are unknown. This could be an important reason for the very low MWTP values reported in this study. For instance, the MWTP for Kitchen is only US$0.9 in the visual format. This is unrealistically low. We acknowledge that although a visual scenario can enhance understanding, it is also very plausible to find the opposite, that is respondents basing their choices on hidden attributes shown in the pictures. This may explain for example, one of the very low estimates observed.

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Acknowledgements

Funding from South African Water Research Commission (WRC) is gratefully acknowledged. We thank Dave Buchanan for editorial support. This paper has been published as an ERSA Working Paper 802.

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Correspondence to Johane Dikgang.

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Murwirapachena, G., Dikgang, J. The effects of presentation formats in choice experiments. Environ Econ Policy Stud 24, 421–445 (2022). https://doi.org/10.1007/s10018-021-00328-4

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