An experimental validation of hypothetical WTP for a recyclable product

Camacho-Cuena, E., García-Gallego, A., Georgantzis, N. and Sabater-Grande, G. (2004) An experimental validation of hypothetical WTP for a recyclable product. Environmental and Resource Economics, 27 (3). pp. 313-335. ISSN 0924-6460 doi: 10.1023/B:EARE.0000017657.08513.74

Abstract/Summary

Using a within-subject experiment, we compare hypothetical and real willingness to pay (WTP) for an improvement in the recyclability of a product. Subjects are faced with a real payment scenario after they have responded to a hypothetical question. Contrary to most of the results obtained in similar studies, at apopulation level, there are no significant median differences between actual and hypothetical stated values of WTP. However,within-subject comparisons between hypothetical and actual values indicate that subjects stating a low (high) hypothetical WTP tend to underestimate (overestimate) the value of their actual contributions.