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The value of familiarity: Effects of knowledge and objective signals on willingness to pay for a public good

Citation

LaRiviere, J and Czajkowski, M and Hanley, N and Aanesen, M and Falk-Petersen, J and Tinch, DR, The value of familiarity: Effects of knowledge and objective signals on willingness to pay for a public good, Journal of Environmental Economics and Management, 68, (2) pp. 376-389. ISSN 0095-0696 (2014) [Refereed Article]

Copyright Statement

Copyright 2014 Elsevier Inc.

DOI: doi:10.1016/j.jeem.2014.07.004

Abstract

We design and conduct a field experiment in which treated subjects receive a precise and objective signal regarding their knowledge about a public good before estimating their WTP for it. We find that the causal effect of objective signals about the accuracy of a subject׳s knowledge for a public good can dramatically affect their valuation for it: treatment caused a significant increase of $85$129 in WTP for well-informed individuals. We find no such effect for less informed subjects. Our results imply that WTP estimates for public goods are not only a function of true information states of the respondents but beliefs about those information states.

Item Details

Item Type:Refereed Article
Keywords:Information, Beliefs, Field Experiment, Valuation, Uncertainty, Choice experiment
Research Division:Economics
Research Group:Applied Economics
Research Field:Environment and Resource Economics
Objective Division:Environment
Objective Group:Environmental and Natural Resource Evaluation
Objective Field:Environmental and Natural Resource Evaluation not elsewhere classified
Author:Tinch, DR (Dr Dugald Tinch)
ID Code:97862
Year Published:2014
Web of Science® Times Cited:12
Deposited By:Tasmanian School of Business and Economics
Deposited On:2015-01-16
Last Modified:2015-06-09
Downloads:0

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