Hypothetical bias and framing effect in the valuation of private consumer goods

Brzozowicz, Magdalena

doi:10.1515/ceej-2018-0024

Abstract

In a laboratory experiment, I examined two behavioural effects: hypothetical bias and the framing effect. I elicited willingness to pay (WTP) for a cosmetic product, and manipulated framing conditions (positive vs. negative attribute framing) and incentives to reveal the actual valuation (hypothetical vs. real). I demonstrated that hypothetical bias has a significant impact on WTP values; however, the framing effect has no effect on the valuation of the product. Similarly, I found no interaction between the two effects. This observation contributes to claims that hypothetical research methods lead to equally reliable data as those based on consequential choices.

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Hypothetical bias and framing effect in the valuation of private consumer goods

Abstract

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