Incorporating outcome uncertainty and prior outcome beliefs in stated preferences
Research output: Contribution to journal › Journal article › Research › peer-review
Standard
Incorporating outcome uncertainty and prior outcome beliefs in stated preferences. / Lundhede, Thomas; Jacobsen, Jette Bredahl; Hanley, Nick; Strange, Niels; Thorsen, Bo Jellesmark.
In: Land Economics, Vol. 91, No. 2, 2015, p. 296-316.Research output: Contribution to journal › Journal article › Research › peer-review
Harvard
APA
Vancouver
Author
Bibtex
}
RIS
TY - JOUR
T1 - Incorporating outcome uncertainty and prior outcome beliefs in stated preferences
AU - Lundhede, Thomas
AU - Jacobsen, Jette Bredahl
AU - Hanley, Nick
AU - Strange, Niels
AU - Thorsen, Bo Jellesmark
PY - 2015
Y1 - 2015
N2 - Stated preference studies tell respondents that policies create environmental changes with varying levels of uncertainty. However, respondents may include their own a priori assessments of uncertainty when making choices among policy options. Using a choice experiment eliciting respondents’ preferences for conservation policies under climate change, we find that higher outcome uncertainty reduces utility. When accounting for endogeneity, we find that prior beliefs play a significant role in this cost of uncertainty. Thus, merely stating “objective” levels of outcome uncertainty will not necessarily solve the problem of people valuing something differently from originally intended: respondents’ prior beliefs must be accounted for.
AB - Stated preference studies tell respondents that policies create environmental changes with varying levels of uncertainty. However, respondents may include their own a priori assessments of uncertainty when making choices among policy options. Using a choice experiment eliciting respondents’ preferences for conservation policies under climate change, we find that higher outcome uncertainty reduces utility. When accounting for endogeneity, we find that prior beliefs play a significant role in this cost of uncertainty. Thus, merely stating “objective” levels of outcome uncertainty will not necessarily solve the problem of people valuing something differently from originally intended: respondents’ prior beliefs must be accounted for.
U2 - 10.3368/le.91.2.296
DO - 10.3368/le.91.2.296
M3 - Journal article
VL - 91
SP - 296
EP - 316
JO - Land Economics
JF - Land Economics
SN - 0023-7639
IS - 2
ER -
ID: 153108340