Working Paper: CEPR ID: DP16903
Authors: Roman Inderst; Stefan Thomas
Abstract: While consumer sustainability benefits exhibit particular characteristics, e.g., as they are typically based on non-use value, they can be measured by standard instruments as applied in environmental cost-benefit analysis, such as conjoint analysis and contingent valuation. Their measurement may be particularly sensitive to provided context, which makes it necessary to be particularly careful when measuring consumers’ willingness-to-pay. This sensitivity, however, also allows to expand the scope for such benefits and enables an appropriate modelling of the counterfactual. While we advocate for a careful consideration of such more “reflective willingness-to-pay”, we are critical about a blank consideration of externalities and with it consumers’ willingness-to-pay for a change in the behaviour of other consumers.
Keywords: Antitrust; Consumer Welfare; Sustainability
JEL Codes: A13; K21; K32
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| framing of choices (D91) | willingness to pay (WTP) (Q26) |
| information provision (L86) | willingness to pay (WTP) (Q26) |
| social norms (Z13) | consumer preferences (D11) |
| individual values (C29) | consumer preferences (D11) |
| contextual factors (D91) | willingness to pay (WTP) (Q26) |