Mitigating hypothetical bias

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dc.contributor.authorAndor, Mark A.
dc.contributor.authorFrondel, Manuel
dc.contributor.authorVance, Colin
dc.date.accessioned2015-04-29T10:40:51Z
dc.date.available2015-04-29T10:40:51Z
dc.date.issued2015
dc.description.abstractThe overestimation of willingness-to-pay (WTP) in hypothetical responses is a well-known finding in the literature. Various techniques have been proposed to remove or, at least, reduce this bias. Using about 30,000 responses on WTP for a variety of power mixes from a panel of 6,500 German households and the fixed-effects estimator to control for unobserved heterogeneity, this article simultaneously explores the effects of two common ex-ante approaches – cheap talk and consequential script – and the ex-post certainty approach to calibrating hypothetical WTP responses. Based on a switching regression model that accounts for the potential endogeneity of respondent certainty, we find evidence for a lower WTP among those respondents who classify themselves as definitely certain about their answers. Although neither cheap talk nor the consequential-script corrective reduce WTP estimates, receiving either of these scripts increases the probability that respondents indicate definite certainty about their WTP bids.en
dc.identifier.urihttp://hdl.handle.net/2003/34071
dc.identifier.urihttp://dx.doi.org/10.17877/DE290R-7506
dc.language.isoende
dc.relation.ispartofseriesDiscussion Paper / SFB 823;11/2015en
dc.subjectwillingness-to-payen
dc.subjectcertainty approachen
dc.subjectcheap talken
dc.subject.ddc310
dc.subject.ddc330
dc.subject.ddc620
dc.titleMitigating hypothetical biasen
dc.title.alternativeEvidence on the effects of correctives from a large field studyen
dc.typeTextde
dc.type.publicationtypeworkingPaperde
dcterms.accessRightsopen access

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Sonderforschungsbereich (SFB) 823