Quarterly Journal of International Agriculture No. 4/06
Do expected income changes bias contingent valuation willingness-to-pay figures?
Franz Hackl and Gerald J. Pruckner
University of Linz, Austria
Abstract
This paper shows that expectations about future income changes may
bias respondents’ answers in contingent valuation (CV) studies. A
practicable ex post approach to control for these biases is proposed:
based on the interviewees’ individual assessment of the personal future
income situation, expected income changes can be econometrically
corrected for in CV. This is illustrated by CV data on an Austrian
national park, the creation of which causes expected income losses and
gains in the forestry and tourism sector.
Keywords: contingent valuation, environmental cost-benefit analysis, expected income changes, applied welfare measures
JEL: D6, H4, Q2
Vol. 45 (2006), No. 4: 421-435