Identification and measurement of utilitarian and non-utilitarian decision principles in contingent valuation studies

• Applicant: Dr. Susanne Menzel
• Subject Area: Economic Theory
• Term: from 2005 to 2008
• Project identifier: Deutsche Forschungsgemeinschaft (DFG) - Project number 5454680

Direct valuation methods are used when information is required about economic value of non-market goods. In the application of these valuation methods the neoclassical theoretical framework is used. This framework usually refers to only one ethical principle: utilitarianism (Anand and Wailoo 2000). Furthermore, it includes the assumption of standard consumer theory that the willingness to pay (WTP) for a good reflects the preferences of a person for this good considering his constrains (Mitchell and Carson 1989). However, the assessment of (utility reflecting) WTP for non-market goods, like environmental goods, is complex because the provision of non-market goods is often closely related to ethically difficult issues (Bulte and Van Kooten 2000; Nyborg 2000). The aim of the proposed work is to investigate empirically - based on a clear theoretical framework - the importance of non-utilitarian principles. Different uses of decision principles by different respondents have implications for adding up WTP to assess benefits or costs of decision alternatives, therefore, an instrument will be developed to make it possible to sum up WTP answers of different people in a reasonable way.

• DFG Programme: Research Fellowships
• International Connection: United Kingdom
• Host: Professor Malcolm S. Cresser