Knowledge and the Valuation of Public Goods and Experiential Commodities: Information Provision and Acquisition

Provides empirical evidence of significant lack of relevant knowledge of some public goods and experiential commodities. It also analyses whether information provision about the attributes or characteristics of commodities is likely to result in individuals’ finding their ‘true’ preferences for these, and identifies the type and nature of information that should be conveyed to enable commodities to be appropriately valued. It also recognizes that sometimes commodities may contain attributes that individuals are unable to evaluate. Furthermore, individuals acquire and filter information about commodities. Factors influencing these activities require analysis. A cost-benefit analysis of information acquisition suggests that individuals are less likely to acquire information about public goods than private goods. Even in a world in which underlying meta-values of commodities are stationary, perceived values of commodities may show dynamic variation due to elicitation procedures and the provision of information about them, followed by crowding out and forgetting of information about the focal commodities. This possibility makes it difficult to determine the appropriate value to use in contingent valuation studies for policy purposes, and in similar approaches to determining individuals’ valuation of commodities. Policy consequences of this are considered