A model of the anchoring effect in dichotomous choice valuation with follow-up

Sandra Nolte (Lechner), Anne Rozan and Francois Laisney

Working Papers of BETA from Bureau d'Economie Théorique et Appliquée, UDS, Strasbourg

Abstract: This paper focuses on modelling and estimating the starting point bias in closed-ended follow-up questions, where several bids are presented successively, depending on previous answers. Although the contingent valuation literature took off in the last decade, there is only one study modelling the starting point bias. We propose a new modelling of this anchoring effect based on the assumption the first proposed bid has a direct influence on the individual's willingness-to-pay, i.e respondents modify their willingness-to-pay when presented with the first bid just before they answer the first question. Monte Carlo results support the specification of our model. An application is provided based on data from a contingent valuation study conducted concerning air quality in Strasbourg.

Keywords: Contingent valuation; willingness-to-pay; binary-choice; anchoring effect. (search for similar items in EconPapers)
JEL-codes: C15 C25 D1 Q0 (search for similar items in EconPapers)
Date: 2003
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Citations: View citations in EconPapers (12)

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Persistent link: https://EconPapers.repec.org/RePEc:ulp:sbbeta:2003-07

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