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HomeEconomyStated preferences in the AER

Stated preferences in the AER

American Economic Review Vol. 113, Issue 7 — July 2023:

The authors mention stated preference research in environmental economics (where it all began, right?) a couple of times. First, we get the obligatory CVM critics pat-on-the-back on page 2010:

The advantages of the stated-preference approach come at potential costs, in particular the concern that actual job choices may differ from stated preferences for jobs (Diamond and Hausman 1994; Manski 1999; Hausman 2012).

They could have chosen some better references to the issue of hypothetical bias, but no. See the comment on Hausman 2012 here

But, then the second is more positive (page 2011):

More generally, the stated-preference approach has provided valuable evidence for many economic topics, including environmental policy (Carlsson and Martinsson
2001; Carson 2012), consumer preferences (Revelt and Train 1998), labor supply (Kimball and Shapiro 2008), retirement decisions (van Soest and Vonkova 2014),
and long-term care (Ameriks et al. 2015). 

Congrats to Carlsson, Martinsson and Carson for being singled out from the thousands of articles to choose from!

In spite of some warts (e.g, Hausman 2012), this is progress.


Carlsson, Fredrik, and Peter Martinsson. 2001. “Do Hypothetical and Actual Marginal Willingness to Pay Differ in Choice Experiments? Application to the Valuation of the Environment.” Journal of Environmental Economics and Management 41 (2): 179–92.

Carson, Richard T. 2012. “Contingent Valuation: A Practical Alternative When Prices Aren’t Available.” Journal of Economic Perspectives 26 (4): 27–42.