Procedural Invariance Testing of the One-and-One-Half-Bound Dichotomous Choice Elicitation Method

Ian J. Bateman; Brett Day; Diane P Dupont; Stavros Georgiou

doi:10.1162/rest.91.4.806

Procedural Invariance Testing of the One-and-One-Half-Bound Dichotomous Choice Elicitation Method

Ian J. Bateman¹; Brett Day¹; Diane P Dupont²; Stavros Georgiou³

¹ Centre for Social and Economic Research on the Global Environment · ² Brock University · ³ Health and Safety Executive

The Review of Economics and Statistics 2009

The contingent valuation method for estimating willingness to pay for public goods typically adopts a single referendum question format, which is relatively statistically inefficient. As an alternative, Cooper, Hanemann, and Signorello (2002) propose the one-and-one-half bound (OOHB) format, allowing researchers to question respondents about both a lower and higher limit on project costs, thereby securing substantial gains in statistical efficiency. Using an experimental design, we find that responses to OOHB valuation questions fail crucial tests of procedural invariance. We test various competing models of observed response patterns including strategic misrepresentation of standard preferences and nonstandard models of preference formation.

DOI: 10.1162/rest.91.4.806
Volume: 91 (4)
Pages: 806-820
Language: en
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