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A comparison of responses to single and repeated discrete choice questions

Author

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  • McNair, Ben J.
  • Bennett, Jeff
  • Hensher, David A.
Abstract
According to neoclassical economic theory, a stated preference elicitation format comprising a single binary choice between the status quo and one alternative is incentive compatible under certain conditions. Formats typically used in choice experiments comprising a sequence of discrete choice questions do not hold this property. In this paper, the effect on stated preferences of expanding the number of binary choice tasks per respondent from one to four is tested using a split sample treatment in an attribute-based survey relating to the undergrounding of overhead low-voltage electricity and telecommunications wires. We find evidence to suggest that presenting multiple choice tasks per respondent decreases estimates of expected willingness to pay. Preferences stated in the first of a sequence of choice tasks are not significantly different from those stated in the incentive compatible single binary choice task, but, in subsequent choice tasks, responses are influenced by cost levels observed in past questions. Three behavioural explanations can be advanced - weak strategic misrepresentation, reference point revision, and asymmetric value learning. The evidence is contrary to the standard assumption of truthful response with stable preferences.

Suggested Citation

  • McNair, Ben J. & Bennett, Jeff & Hensher, David A., 2011. "A comparison of responses to single and repeated discrete choice questions," Resource and Energy Economics, Elsevier, vol. 33(3), pages 554-571, September.
    • Handle: RePEc:eee:resene:v:33:y:2011:i:3:p:554-571
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    More about this item

    Keywords

    Choice experiment Willingness to pay Incentive compatibility Order effects Undergrounding;

    JEL classification:

    • L94 - Industrial Organization - - Industry Studies: Transportation and Utilities - - - Electric Utilities
    • Q51 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Valuation of Environmental Effects

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