WTP and WTA for Expressway Services

Metin Senbil and Ryuichi Kitamura
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Metin Senbil: Hiroshima University
Ryuichi Kitamura: Kyoto University

A chapter in Developments on Experimental Economics, 2007, pp 143-148 from Springer

Abstract: Abstract Changes in consumer surplus have been approached in two different ways [1,2]: one is the compensating variation (CV), which is the amount of income that an individual is ready to pay to keep his utility as it was before a change; the other is the equivalent variation (EV), which is the amount of money the individual is ready to accept for the change. For welfare gains, CV and EV are known as willingness to pay (to attain the gain, WTP) and willingness to accept (to accept the absence of the gain, WTA) respectively; but for a welfare loss, CV and EV refer to WTA (to compensate the loss) and WTP (to prevent the loss).

Keywords: Consumer Surplus; Surface Street; Equivalent Variation; Coupling Time; Loss Region (search for similar items in EconPapers)
Date: 2007
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DOI: 10.1007/978-3-540-68660-6_11

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