Introduction

Making collective decisions about public activities through voting is justified by the idea that individuals reveal their preferences through voting, and that knowledge of individual preferences permits determinations of which potential public activities are worthwhile. This raises the question of how voting should be structured to provide the most useful information about individual preferences. This chapter addresses that question.

One might suppose that if accurate individual preferences are needed to make good collective decisions, the natural thing to do would be just to ask people for their preferences. Indeed, a tradition has developed that regards the value of public activities as something that can be determined through public opinion surveys. The name that is given to a valuation obtained in this way is a “contingent valuation.” The idea behind this phrase is that respondents are asked how much value they would place on a contingency, such as a new road that provided improved access to a recreation area. When contingent valuation is used, there is generally no determinate relationship between the results of a survey and levels of spending on public activities. Thus, it is not clear that contingent valuation should be regarded as a form of voting. One can imagine, however, that if the results of contingent valuation surveys were regarded as credible, then a determinate relationship between survey results and public spending might be prescribed: all public activities revealed by contingent valuation to be worthwhile shall be provided. In such an event, contingent valuation might be regarded as a form of voting.