Skip to main content
Article
Resolving Differences in Willingness to Pay and Willingness to Accept
American Economic Review
  • Jason F. Shogren, Iowa State University
  • Seung Y. Shin, Iowa State University
  • Dermot J. Hayes, Iowa State University
  • James B. Kliebenstein, Iowa State University
Document Type
Article
Publication Date
3-1-1994
Abstract

This paper tests the conjecture that the divergence of willingness to pay (WTP) and willingness to accept (WTA) for identical goods is driven by the degree of substitution between goods. In contrast to well-known results for market goods with close substitutes (i.e., candy bars and coffee mugs), our results indicate a convergence of WTP and WTA measures of value. However, for a nonmarket good with imperfect substitutes (i.e., reduced health risk), the divergence of WTP and WTA value measures is persistent, even with repeated market participation and full information on the nature of the good.

Comments

This article is from American Economic Review 84, no. 1 (March 1994): 255–270.

Copyright Owner
American Economic Association
Language
en
Date Available
April 1, 2013
File Format
application/pdf
Citation Information
Jason F. Shogren, Seung Y. Shin, Dermot J. Hayes and James B. Kliebenstein. "Resolving Differences in Willingness to Pay and Willingness to Accept" American Economic Review Vol. 84 Iss. 14 (1994) p. 255 - 270
Available at: http://works.bepress.com/dermot_hayes/7/