What Experimental Protocol Influence Disparities Between Actual and Hypothetical Stated Values?

Preferences elicited in hypothetical settings have recently come underscrutiny, causing estimates from the contingent valuation method to bechallenged due to perceived ``hypothetical bias.'' Given that the receivedliterature derives value estimates using heterogeneous experimentaltechniques, understanding the effects of important design parameters onthe magnitude of hypothetical bias is invaluable. In this paper, we addressthis issue statistically by using a meta-analysis to examine data from 29experimental studies. Our empirical findings suggest that on averagesubjects overstate their preferences by a factor of about 3 in hypotheticalsettings, and that the degree of over-revelation is influenced by thedistinction between willingness-to-pay and willingness-to-accept, publicversus private goods, and several elicitation methods.

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