Contingent Valuation and Real Economic Commitments: A Private Good Experiment

Publisher Website
Google Scholar
Abstract
The ultimate test of the accuracy of contingent valuation methods (CVM), in measuring benefits, is whether subjects will actually pay the amounts that they say they would be willing to pay in a CVM study. An experiment was conducted in which the maximum WTP of potential visitors to enter Warkworth Castle was compared against the acceptance of an entrance ticket at their stated CV price, thus providing a real monetary test of value and behavioural intention. Only 40% of potential visitors at the Castle gate were willing to make a real economic commitment following their CV WTP responses. Whilst the CVM results were found to be comparable with other CVM studies in terms of content and construct validity, they clearly failed a criterion validity test, even when the CVM survey was juxtaposed to the behavioural intention stage. CVM studies need to adopt stringent criteria in deciding the 'truthfulness' and 'legitimacy' of WTP responses, if CVM is to provide accurate and robust estimates of the value of environmental goods.