Eliciting Preferences for Public Goods in Nonmonetized Communities: Accounting for Preference Uncertainty

Abstract

Labor time has been proposed as an alternative payment vehicle in eliciting preferences for public goods in nonmonetized communities. However, we so far have no empirical evidence for situations where the labor-time elicitation format reduces the respondent’s contribution uncertainty. In this study we compare the uncertainty of people’s stated willingness to contribute time and money for a local public good in a nonmonetized small-scale community in Papua New Guinea. We find that independently of conversion issues, uncertainty is reduced when respondents are asked to contribute time instead of money. Moreover, we find that risk aversion, risk apprehension, and risk exposure are significant predictors of uncertainty. (JEL Q51)