On Price Data Elicitation: a Laboratory Investigation

Andrea Morone ()

MPRA Paper from University Library of Munich, Germany

Abstract: There is abundant literature in experimental research on decision making under risk, which compares, and ranks subjects’ preferences on the basis of some elicitation method. The present paper performs a similar analysis in order to compare them. Since pricing data lead in many cases to some anomalies (i.e. status quo bias endowment effect) we examine three mechanisms to elicit price preferences: willingness-to-pay in a second price auction, willingness-to-accept in a second price auction, and certainty equivalent elicited with BDM. A Bayesian interpretation of our results suggests that it is not possible to state ex-ante the more appropriate elicitation method for a particular subject: for 1/3 of our sample WTP is preferred for 1/3 of our sample WTA is preferred and for the remaining 1/3 BDM is preferred.

Keywords: willingness-to-pay; willingness-to-accept; BDM; second price auction (search for similar items in EconPapers)
JEL-codes: D81 (search for similar items in EconPapers)
New Economics Papers: this item is included in nep-cbe, nep-exp and nep-upt
Date: 2009-10
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Persistent link: http://EconPapers.repec.org/RePEc:pra:mprapa:18358

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