Abstract
This paper considers how respondents model the open-ended willingness to pay question, what is your maximum willingness to pay? In the specific context of valuing Irish public service broadcasting, respondents were asked a follow-up question in order to explore whether the initial response was an individual or household bid. The results suggest the presence of significant ambiguity in how responses to standard willingness to pay questions should be interpreted and aggregated.
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Notes
A full taxonomy would examine the sampling unit (household or individual), the elicitation format (e.g., open ended or dichotomous choice) and the unit of valuation (household or individual). The sampling unit and the valuation unit need not, of course, be the same. For example, we could elicit household valuations from individual respondents.
Although an open-ended CVM question was used in this specific survey, it seems clear that similar issues would arise in non open-ended CVM questions.
The simple comparison between €18.07 (stated unit of response was ‘individual’) and €18.24 (stated unit of response was ‘household’) does not incorporate an analysis of other possible differences between the two sets of households (e.g., income, age, ...).
This explanation was suggested by one of the anonymous referees to whom we are grateful. We propose to explore this possibility in future work.
According to Census 2002 (Central Statistics Office Ireland, www.cso.ie) there were 1,287,958 private households in Ireland at the time of the survey, with 3,791,316 individuals, an average of 2.9 per household. There were 3,089,775 individuals aged over 15, the population of our study.
References
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Acknowledgements
The authors would like to thank the editor, two anonymous referees and seminar participants in Trinity College Dublin and ACEI Chicago 2004 for helpful comments. RTÉ funded the nationwide survey that was administered by Lansdowne Market Research.
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Delaney, L., O’Toole, F. Willingness to pay: individual or household?. J Cult Econ 30, 305–309 (2006). https://doi.org/10.1007/s10824-006-9021-8
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DOI: https://doi.org/10.1007/s10824-006-9021-8