RT Journal Article
SR Electronic
T1 An Inferred Valuation Method
JF Land Economics
JO Land Econ
FD University of Wisconsin Press
SP 500
OP 514
DO 10.3368/le.85.3.500
VO 85
IS 3
A1 Lusk, Jayson L.
A1 Norwood, F. Bailey
YR 2009
UL http://le.uwpress.org/content/85/3/500.abstract
AB Although estimates of people’s values for public goods are often needed to conduct costbenefit analysis, existing value elicitation methods are prone to a number of well-documented biases. We argue that some of these biases result because people derive utility from the act of saying they are willing to pay for a good. To counteract this phenomenon, we consider an approach that asks people to predict or infer others’ values for a good instead of asking people to state their own value. Both a conceptual model and results from a laboratory experiment lend support for the new approach. (JEL H41, Q51)