Valuing public goods with the contingent valuation method: A critique of kahneman and knetsch

摘要: The social stakes in the use and abuse of Contingent Valuation Method (CVM) are very high. Recent developments environmental law have elevated CVM to status a refutable presumption cases brought under certain statutes. It is no longer adequate for economists sniff at continued popularity such cases. is, instead, incumbent on come some conclusions as domain which may or not be correctly applied. One should expect simple “thumbs up” down” assessment this matter. Such an expectation would naive with respect inherent complexity issue, mention financial incentives that expert witnesses might breed “as if’ controversy adversarial legal system. In context strong admonitions Kahneman Knetsch [3] (KK) against casual must carefully examined. They present what they believe evidence support claim suffers from embedding effect, any reported Willingness Pay (WTP) “best interpreted purchase moral satisfaction, rather than measure value associated particular public good.” I argue their insufficient test implied hypotheses, it incorrectly reported, large fully consistent received economic theory.