Obtaining Unbiased Contingent Values: Further Tests of Entreaties to Avoid Hypothetical Bias

1. Obtaining Unbiased Contingent Values: Further Tests of Entreaties to Avoid Hypothetical Bias Thomas C. Brown, Icek Ajzen, and Daniel Hrubes

2. The Hypothetical Bias may come from: • over-estimate. • ignore their budget constraint • try to pay for ‘free riders’ • use their vote to indicate whether or not they think such a referendum should be held for real.

3. Introduction • Test method (similar to budget constrain reminder) to correct hypothetical bias • Generally the method instructs respondents that when responding WTP, they respond it as if it were real payment.

4. Method to correct hypothetical bias • “reminder” remind respondent clearly that please response as if you are really paying • “cheap talk” Instruct respondent that there is the hypothetical bias, discuss about it and remind them they should self-correct for it

5. Discussion • The Cummings and Taylor script is long and difficult to use on the phone or in the mail • The Loomis script is short and did not educate about the hypothetical bias • The testing has been conducted with the students at the University of Massachusets

6. Results from experiment

7. Discussion (con’t) • Only further research will determine whether the script can be shortened without loss of impact. • If further tests continue to show that the cheap talk script helps remove bias at all but insignificant small (e.g., $1) payment amounts, but works extremely well at higher payment amounts • If additional research shows that the script can be shortened in length without loss of effect, it would not appropriate to delay its application to dichotomous choice contingent valuation.

8. Conclusion • The script worked well whether the vote was open or secret at higher payment levels, but inadequately corrected the bias at a lower payment level

9. Group members • Mr. Pornpoj Roger Sangsuchat • Ms. Saranporn Rungreangsri • Ms. Tanyathon Phetmanee