Working Paper: NBER ID: w16036
Authors: Jonathan E. Alevy; John List; Wiktor Adamowicz
Abstract: Psychological insights have made inroads within most major areas of study in economics. One area where less advance has been made is environmental and resource economics. In this study, we examine the implications of preference reversals over evaluation modes, in which stated economic values critically depend on whether the good is valued jointly with others or in isolation. The question arises because two commonly used methods for eliciting stated preferences differ in that one presents objects together and another presents objects to be evaluated in isolation. Beyond showing an example of the import of behavioral economics, our empirical evidence sheds new light on the factors associated with insensitivity of valuations to the scope of the good.
Keywords: Behavioral Economics; Nonmarket Valuation; Preference Reversal
JEL Codes: C9; Q5; Q51
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| evaluation mode (C52) | bids for the 10-card bundle (li) (D44) |
| evaluation mode (C52) | bids for the 13-card bundle (mi) (D44) |
| removal of grading information (Y40) | preference reversal among inexperienced agents (D01) |
| evaluation mode (C52) | contributions to public goods (H40) |
| experience (Y60) | evaluation mode effect (C52) |