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The Provision Point Mechanism and Scenario Rejection in Contingent Valuation

Published online by Cambridge University Press:  15 September 2016

Peter A. Groothuis  and
John C. Whitehead
Peter A. Groothuis
Affiliation:
Department of Economics at Appalachian State University in Boone, North Carolina
John C. Whitehead
Affiliation:
Department of Economics at Appalachian State University in Boone, North Carolina
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Abstract

The provision point mechanism mitigates free-riding behavior in economic experiments. In two contingent valuation method surveys, we implement the provision point design. We ask respondents for their perceptions about the success of the provision point mechanism. We find that respondents who believe that the provision point would not be met are more likely to say no to a contingent valuation dichotomous choice question. The scenario rejection that arises may result in biased willingness-to-pay estimates.

Keywords

provision point mechanismcontingent valuationwillingness to paypublic goods
Type
Contributed Papers
Information
Agricultural and Resource Economics Review , Volume 38 , Issue 2 , October 2009 , pp. 271 - 280
Copyright
Copyright © 2009 Northeastern Agricultural and Resource Economics Association 

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