An alternative approach for eliciting willingness-to-pay

Open-ended methods that elicit willingness-to-pay (WTP) in terms of absolute dollars often result in high rates of questionable and highly skewed responses, insensitivity to changes in health state, and raise an ethical issue related to its association with personal income. We conducted a 2x2 random...

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Bibliographic Details
Main Authors: Laura J. Damschroder, Peter A. Ubel, Jason Riis, Dylan M. Smith
Format: Article
Language:English
Published: Society for Judgment and Decision Making 2007-04-01
Series:Judgment and Decision Making
Subjects:
Online Access:http://journal.sjdm.org/jdm06163.pdf
Description
Summary:Open-ended methods that elicit willingness-to-pay (WTP) in terms of absolute dollars often result in high rates of questionable and highly skewed responses, insensitivity to changes in health state, and raise an ethical issue related to its association with personal income. We conducted a 2x2 randomized trial over the Internet to test 4 WTP formats: 1) WTP in dollars; 2) WTP as a percentage of financial resources; 3) WTP in terms of monthly payments; and 4) WTP as a single lump-sum amount. WTP as a percentage of financial resources generated fewer questionable values, had better distribution properties, greater sensitivity to severity of health states, and was not associated with income. WTP elicited on a monthly basis also showed promise.
ISSN:1930-2975