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The effects of emotions on preferences and choices for public goods

Christopher Boyce (), Mikolaj Czajkowski, Nick Hanley, Charles Noussair, Michael Townsend () and Steven Tucker
Additional contact information
Christopher Boyce: Management School, University of Stirling
Michael Townsend: National Institute for Water and Atmosphere Ltd

No 2015-13, Working Papers from Faculty of Economic Sciences, University of Warsaw

Abstract: This paper tests whether changes in “incidental emotions” lead to changes in economic choices. Incidental emotions are experienced at the time of an economic decision but are not part of the payoff from a particular choice. As such, the standard economic model predicts that incidental emotions should not affect behavior, yet many papers in the behavioral science and psychology literatures find evidence of such effects. In this paper, we used a standard procedure to induce different incidental emotional states in respondents, and then carried out a choice experiment on changes to an environmental good (beach quality). We estimated preferences for this environmental good and willingness to pay for changes in this good, and tested whether these were dependent on the particular emotional state induced. We also tested whether choices became more or less random when emotional states were induced, based on the notion of randomness in a standard random utility model. Contrary to our a-priori hypothesis we found no significant evidence of treatment effects, implying that economists need not worry about the effects of variations in incidental emotions on preferences and the randomness of choice, even when there is measured (induced) variation in these emotions.

Keywords: choice experiments; behavioral economics; ecosystem services; emotions; rationality (search for similar items in EconPapers)
JEL-codes: D03 D87 Q51 Q57 (search for similar items in EconPapers)
Pages: 28 pages
Date: 2015
New Economics Papers: this item is included in nep-cbe, nep-dcm, nep-exp, nep-neu, nep-res and nep-soc
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