An Experimental Investigation of Explanations for Inconsistencies in Responses to Second Offers in Double Referenda

18 Pages Posted: 12 Sep 2013

See all articles by Anthony Burton

Anthony Burton

Government of New Zealand - Treasury

Katherine Silz Carson

US Air Force Academy

Susan M. Chilton

University of Newcastle - Economics

W. George Hutchinson

Queen's University Belfast

Date Written: November 1, 2003

Abstract

This paper demonstrates the potential for induced preference experiments to test previously unverified explanations of observed behavior in contingent valuation surveys. The NOAA Panel on Contingent Valuation called for experimental evidence on potential biases in the double referendum format. We test Carson, Groves, and Machina’s (Incentives and informational properties of preference questions, Plenary address to the European Association of Resource and Environmental Economists, Oslo, Norway, June 1999) simple cost uncertainty and weighted averaging explanations of inconsistent responses to follow-up offers in such double referenda against a baseline of certainty and truthful preference revelation. The results find evidence to support the Weighted Average hypothesis. Results regarding the cost uncertainty hypothesis are more ambiguous and merit further investigation.

Keywords: Experimental economics, Contingent valuation, Double referenda, Induced preferences

JEL Classification: C91, Q51

Suggested Citation

Burton, Anthony and Carson, Katherine Silz and Chilton, Susan M. and Hutchinson, W. George, An Experimental Investigation of Explanations for Inconsistencies in Responses to Second Offers in Double Referenda (November 1, 2003). Journal of Environmental Economics and Management, Vol. 46, No. 3, 2003. Available at SSRN: https://ssrn.com/abstract=2324333

Anthony Burton

Government of New Zealand - Treasury

No. 1, The Terrace
Wellington, 6011
New Zealand

Katherine Silz Carson (Contact Author)

US Air Force Academy ( email )

HQ USAFA/DFEG
2354 Fairchild Drive, Suite 6K110
USAF Academy, CO 80840-6299
United States

Susan M. Chilton

University of Newcastle - Economics ( email )

Newcastle-upon-Tyne NE1 7RU
United Kingdom

W. George Hutchinson

Queen's University Belfast ( email )

David Leir Building
Belfast, BT9 5AG
Ireland

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