Multiple price lists for willingness to pay elicitation

• Published in: Journal of development economics Vol. 159; p. 102977
• Main Authors: Jack, B. Kelsey, McDermott, Kathryn, Sautmann, Anja
• Format: Journal Article
• Language: English
• Published: Elsevier B.V 01.11.2022
• Subjects: Multiple price list; Preference elicitation; Survey methods; Template module; Willingness to pay; Survey methods; Multiple price list; Preference elicitation; Willingness to pay; Template module
• ISSN: 0304-3878
• DOI: 10.1016/j.jdeveco.2022.102977

Multiple price lists are a convenient tool to elicit willingness to pay (WTP) in surveys and experiments, but choice patterns such as “multiple switching” and “never switching” indicate high error rates. Existing measurement approaches often do not provide accurate standard errors and cannot correct for bias due to framing and order effects. We propose to combine a randomization approach with a random-effects latent utility model to detect bias and account for error. Data from a choice experiment in South Africa shows that significant order effects exist which, if uncorrected, would lead to distorted conclusions about subjects’ preferences. We provide templates to create a multiple price list survey instrument in SurveyCTO and analyze the resulting data using our proposed methods. •Multiple price lists (MPL) are a useful tool for eliciting willingness to pay.•Existing approaches to implementing MPL and analyzing MPL data can lead to bias.•The order in which MPL choices are shown significantly affects elicited valuations.•We describe strategies to address these issues, implemented in a software package.•We demonstrate both the problems and our solutions using a case study in South Africa.