Reducing bias in preference elicitation for environmental public goods

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The recent stated preference literature emphasises the importance of incentive compatible elicitation methods, which depend on respondent beliefs that payment can be collected if provision occurs. We investigate this condition in a randomised field experiment where stated choices are incentivised financially. The objective of the treatment was to make choices salient by making each decision financially relevant and to increase the respondents' beliefs that future payments will be enforced. Our results show that the treatment increases estimates of the marginal utility of income, with the effect being economically and statistically significant for low-income respondents. We develop a stylised theoretical framework that allows us to quantify the bias that is implied by the observed differences between the treated and control groups. We find that failure to account for respondents' doubts about payment coercion in an otherwise well-designed survey inflates the marginal willingness to pay among low-income respondents by a factor of at least 1.72.

Original languageEnglish
Pages (from-to)280-308
Number of pages29
JournalAustralian Journal of Agricultural and Resource Economics
Issue number2
Publication statusPublished - Apr 2022


  • consequentiality
  • field experiment
  • non-market goods
  • payment coercion
  • quasi-public goods
  • stated preference

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