Incentive Incompatibility and Starting-Point Bias in Iterative Valuation Questions: Comment

David Aadland and Arthur J. Caplan


In a recent study, Whitehead (2002) proposes incentive-incompatibility and starting-point-bias tests for iterative willingness-to-pay questions. We show that if restrictions associated with the nature of starting-point bias are not imposed on the estimation, one obtains inconsistent estimates of the structural parameters and may draw inaccurate conclusions regarding the extent of incentive incompatibility and starting-point bias in contingent-valuation survey data. (JEL Q26, C35)

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