Payment Certainty in Discrete Choice Contingent Valuation Responses: Results from a Field Validity Test

WP 2001-21 November 2001Two methods for calibrating discrete choice contingent valuation responses – the dichotomous choice with follow-up certainty question method of Champ et al. (1997) and the multiple bounded method of Welsh and Poe (1998) – are evaluated using data from a field validity comparison of hypothetical and actual participation decisions in a green electricity pricing program. Both calibration methods can produce hypothetical participation levels that closely correspond with actual program participation rates. However, the two methods demonstrate procedural variance as they yield significantly different underlying distributions of willingness to pay.Funding for this project was provided by NSF/EPA Grant R 824688 and USDA Regional Projects W-133, Cornell University