T. Heberlein, R. Bishop
Nov 15, 1986
Science of The Total Environment
Abstract Contingent valuation, in social psychological terms, is a measure of behavioral intention (BI), or what people say they will do on surveys. Market values, on the other hand, are obtained through observable buying and selling behaviors (B). The relationship between BI and B was explored in three field experiments. Hunters had an opportunity to sell their free but difficult to obtain hunting permits or buy such a permit. When it came to selling permits in a take it or leave it situation, the amount people said they would take was 60 percent higher in one experiment and 200 percent higher in the other than what they actually sold it for. Willingness to sell values were greatly inflated by using a sealed bid auction, and in this case hunters said they would take less than they really would take. For selling we conclude contingent valuation is not a good substitute for market behaviors. In contrast, willingness to pay is a much better indicator of what hunters actually paid to buy a permit. In two experiments, BI was 25 percent and 33 percent higher than B (N.S.). Further, the sealed bid auction gave the same results as dichotomous choice. Bidding in the willingness to pay situation increased the difference between BI and B. We speculated that because of repeated buying behaviors consumers have a pretty good idea of what they will pay and can answer correctly on a survey. In contrast they seldom sell things, especially hunting permits, and do not have a good idea of what they really will sell for until confronted with cash.