The Willingness to Pay—Willingness to Accept Gap, the "Endowment Effect," Subject Misconceptions, and Experimental Procedures for Eliciting Valuations: Comment

Plott and Zeiler (2005) report that the willingness-to-pay/willingness-to-accept disparity is absent for mugs in a particular experimental setting, designed to neutralize misconceptions about the procedures used to elicit valuations. This result has received sustained attention in the literature. Ho...

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Bibliographic Details
Published inThe American economic review Vol. 101; no. 2; pp. 991 - 1011
Main Authors Isoni, Andrea, Loomes, Graham, Sugden, Robert
Format Journal Article
LanguageEnglish
Published Nashville American Economic Association 01.04.2011
Subjects
Coffee mugs
Commodities
Consumer behavior
Consumer behaviour
Design
Economics
Endowment
Endowment effect
Experiment design
Experimental economics
Experimental procedures
Experimental replication
Experiments
Fees
Hypotheses
Lotteries
Misconception
Risk aversion
Shorter Papers
Standard deviation
Studies
Valuation
Willingness to pay
United States > US
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Summary:Plott and Zeiler (2005) report that the willingness-to-pay/willingness-to-accept disparity is absent for mugs in a particular experimental setting, designed to neutralize misconceptions about the procedures used to elicit valuations. This result has received sustained attention in the literature. However, other data from that same study, not published in that paper, exhibit a significant and persistent disparity when the same experimental procedures are applied to lotteries. We report new data confirming both results, thereby suggesting that the presence or absence of a disparity may be a more complex issue than some may have supposed. (JEL C91, D12, D81, D83)
Bibliography:SourceType-Scholarly Journals-1
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ISSN:0002-8282
1944-7981
DOI:10.1257/aer.101.2.991