RT Journal Article
SR Electronic
T1 Lexicographic Preferences in Contingent Valuation: A Theoretical Framework with Illustrations
JF Land Economics
JO Land Econ
FD University of Wisconsin Press
SP 277
OP 291
DO 10.2307/3146871
VO 79
IS 2
A1 Rekola, Mika
YR 2003
UL http://le.uwpress.org/content/79/2/277.abstract
AB This paper considers some implications of L*-ordering, an incommensurable preference model proposed in earlier CV literature. The structure and existence of inverse demand functions is shown to be a function of three elements, the relationship between goods and wants, WTA/WTP formats and the endowment of the good. In a many-to-many relationship uncompensated and even compensated inverse demand functions may exist, whereas a one-to-one relationship, implicitly assumed in earlier literature, does not necessarily produce either. An illustration is provided in support of the theoretical framework, especially the hypothesis that one-to-one relationship and high share of CV responses revealing lexicographic preferences are correlated. (JEL Q26)