The Effect of Learning and Fatigue on Preferences and WTP in a ...

More documents

Recommendations

Info

they all are larger than one, <strong>and</strong> hence the error variance is smaller than one, suggestive <strong>of</strong> the already established learning effect. What is also important to note is that it appears, from the bottom row <strong>of</strong> the table, that the learning effect only takes place primarily in the first CS, <strong>and</strong> not as much successively through the following CS as can be seen from the insignificant differences between the scale factors. This is in contrast to the findings by Bateman et al. (2008b), where the most reliable estimates are found during the first 4 <strong>and</strong> last 4 CS, whereas the middle 8 CS somewhat surprisingly are the least reliable estimates. <strong>The</strong> results are however largely in accordance with Ladenburg & Olsen (2008) who find evidence that preferences become stable after the first three CS, supporting the notion <strong>of</strong> learning effects taking place. 6. Conclusion This paper addresses the issues <strong>of</strong> how learning <strong>and</strong> fatigue effects related to the repeated choices potentially affect respondents’ stated preferences in a Choice Experiment setting. <strong>The</strong> main focus is on changes in preference structure, error variance <strong>and</strong> willingness-to-pay. To the best <strong>of</strong> the authors’ knowledge this paper is the first to provide an internal test across all these three measures in one study. In a case study concerning food quality attributes in chicken breast filet, the results show that a learning effect is indeed present in a sequence <strong>of</strong> 16 choice sets, whereas there is no evidence <strong>of</strong> fatigue effects. This conclusion is based on an observed reduction in the error variance for the last 8 choice sets relative to the first 8 choice sets – a result implying that preferences have become relatively more stable in the last half <strong>of</strong> the choice set sequence which is in accordance with the Discovered Preference Hypothesis <strong>and</strong> the concept <strong>of</strong> learning. An analysis incorporating choice set specific scale factors reveals that the main part <strong>of</strong> the observed learning process takes place in the first choice set. <strong>The</strong> overall preference structure is found to differ significantly between the two sequences <strong>of</strong> choice sets. This suggests that the learning effect leads to changes in overall 18
preference structure. Turning to a comparison <strong>of</strong> attribute WTP estimates based on the first <strong>and</strong> the last half <strong>of</strong> the choice set sequence, the results indicate that the change in overall preference structure is mainly driven by respondents refining <strong>and</strong> significantly adjusting their stated values upwardly for two <strong>of</strong> the four quality attributes considered in the survey. <strong>The</strong> implication is that if the main objective <strong>of</strong> a Choice Experiment survey is to obtain policy advice in terms <strong>of</strong> WTP, then allowing for learning effects can be essential. Of course, generalisations based on a single survey are inappropriate, so more research is clearly needed. Specifically, bearing in mind that most <strong>of</strong>ten the purpose <strong>of</strong> economic valuation is to obtain WTP estimates, more investigations considering the impact <strong>of</strong> learning on WTP estimates are necessary to further assess the importance <strong>of</strong> allowing respondents to engage in learning prior to the actual preference eliciting valuation questions. 19
Page 1 and 2: The Effect
Page 3 and 4: Waldman 2008). However, results are
Page 5 and 6: not by changing preferences as have
Page 7 and 8: eginning and in th
Page 9 and 10: unobserved variability, and
Page 11 and 12: expectation of the
Page 13 and 14: Note: ASC is the alternative specif
Page 15 and 16: Scarpa et al. 2008, Swait & Louvier
Page 17: testing for impacts on WTP can be n
Page 21 and 22: Dellaert, B. G. C.; Brazell, J. D.

The Effect of Learning and Fatigue on Preferences and WTP in a ...

You also want an ePaper? Increase the reach of your titles

Delete template?

Save as template?