Scandinavian Working Papers in Economics
Working Papers in Economics,
University of Gothenburg, Department of Economics
No 150: Preferences With and Without Prices - does the price attribute affect behavior in stated preference surveys?
Fredrik Carlsson (), Peter Frykblom () and Carl-Johan Lagerkvist ()
Additional contact information
Fredrik Carlsson: Department of Economics, School of Economics and Commercial Law, Göteborg University, Postal: Box 640, SE 405 30 GÖTEBORG, Sweden
Peter Frykblom: Department of Economics, Appalachian State University, Postal: Boone, North Carolina 28608-2051
Carl-Johan Lagerkvist: Department of Economics, Swedish University of Agricultural Sciences, Postal: Box 7013, SE-750 07 Uppsala, Sweden
Abstract: The experimental as well as the nonmarket valuation literature include several examples of how an introduced price can affect behavior in otherwise not expected ways. It has become standard to include a price vector as an attribute in choice experiments, something that enables us to estimate a marginal willingness to pay for other attributes. We test the impact on preferences by an inclusion of a price in a choice experiment. Preferences are affected, as might be expected. However, also the relative ranking of individual attributes is affected. We end on a positive note, observing that a price seems to drive out zero price opinions, e.g. warm glow values.
Keywords: choice experiment; hypothetical WTP; preference reversal
14 pages, November 18, 2004
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