Value-elicitation and value-formation properties of discrete choice experiment and experimental auctions

Simone Cerroni; Verity Watson; Dimitrios Kalentakis; Jennie I. Macdiarmid

doi:10.1093/erae/jby014

Value-elicitation and value-formation properties of discrete choice experiment and experimental auctions

Simone Cerroni (Corresponding Author), Verity Watson, Dimitrios Kalentakis, Jennie I. Macdiarmid

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Abstract

This paper tests if second-price Vickrey auction (SPVA) and discrete choice experiment (DCE) are isomorphic, and whether lack of isomorphism is due to value elicitation, value-formation or both. We conduct an artefactual field experiment that combines induced-value (IV) and home-grown (HG) procedures using SPVA and DCE. Induced-value preferences are elicited for tokens and HG preferences for multi-attribute lasagnes. Attributes are healthiness and environmental sustainability. Our results suggest that HG preferences differ across elicitation methods. This discrepancy is due to value-elicitation and value-formation. DCE is the most demand revealing approach and provides the highest premiums for healthy and environmentally sustainable lasagnes.

Original language	English
Pages (from-to)	3-27
Number of pages	25
Journal	European Review of Agricultural Economics
Volume	46
Issue number	1
Early online date	3 Jul 2018
DOIs	https://doi.org/10.1093/erae/jby014
Publication status	Published - Feb 2019

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Accepted Manuscript
This is a pre-copyedited, author-produced version of an article accepted for publication in European Review of Agricultural Economics following peer review. The version of record Cerroni, S, Watson, V, Kalentakis, D & Macdiarmid, JI 2018, 'Value-elicitation and value-formation properties of discrete choice experiment and experimental auctions' European Review of Agricultural Economics. 46 (1) pp.3-27 is available online at: https://doi.org/10.1093/erae/jby014
Accepted author manuscript, 902 KBLicence: Unspecified

Jennie Macdiarmid
Person
Verity Watson
- School of Medicine, Medical Sciences & Nutrition, Health Economics Research Unit - Senior Research Fellow
Person: Academic Related - Research

Cite this

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title = "Value-elicitation and value-formation properties of discrete choice experiment and experimental auctions",

abstract = "This paper tests if second-price Vickrey auction (SPVA) and discrete choice experiment (DCE) are isomorphic, and whether lack of isomorphism is due to value elicitation, value-formation or both. We conduct an artefactual field experiment that combines induced-value (IV) and home-grown (HG) procedures using SPVA and DCE. Induced-value preferences are elicited for tokens and HG preferences for multi-attribute lasagnes. Attributes are healthiness and environmental sustainability. Our results suggest that HG preferences differ across elicitation methods. This discrepancy is due to value-elicitation and value-formation. DCE is the most demand revealing approach and provides the highest premiums for healthy and environmentally sustainable lasagnes.",

author = "Simone Cerroni and Verity Watson and Dimitrios Kalentakis and Macdiarmid, {Jennie I.}",

note = "Acknowledgements We thank Christian Reynolds for his help in organising sessions and running the experiment at the Scottish Experimental Economics Laboratory (SEEL) at University of Aberdeen. We also thank Sylvia Stephen for her help in creating the recipes for the lasagnes and the professional cooks of the Human Nutrition Unit of the Rowett Institute for preparing the final products. We appreciate comments on the approach from Professor Joseph Swierzbinski. We thank three anonymous reviewers and the editor for comments on an earlier draft of this paper. Funding This research was funded by the Scottish Government – Rural Affairs and the Environment Strategic Research (RESAS) – and the Chief Scientist Office of the Scottish Government Health and Care Directorates.",

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N1 - Acknowledgements We thank Christian Reynolds for his help in organising sessions and running the experiment at the Scottish Experimental Economics Laboratory (SEEL) at University of Aberdeen. We also thank Sylvia Stephen for her help in creating the recipes for the lasagnes and the professional cooks of the Human Nutrition Unit of the Rowett Institute for preparing the final products. We appreciate comments on the approach from Professor Joseph Swierzbinski. We thank three anonymous reviewers and the editor for comments on an earlier draft of this paper. Funding This research was funded by the Scottish Government – Rural Affairs and the Environment Strategic Research (RESAS) – and the Chief Scientist Office of the Scottish Government Health and Care Directorates.

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N2 - This paper tests if second-price Vickrey auction (SPVA) and discrete choice experiment (DCE) are isomorphic, and whether lack of isomorphism is due to value elicitation, value-formation or both. We conduct an artefactual field experiment that combines induced-value (IV) and home-grown (HG) procedures using SPVA and DCE. Induced-value preferences are elicited for tokens and HG preferences for multi-attribute lasagnes. Attributes are healthiness and environmental sustainability. Our results suggest that HG preferences differ across elicitation methods. This discrepancy is due to value-elicitation and value-formation. DCE is the most demand revealing approach and provides the highest premiums for healthy and environmentally sustainable lasagnes.

AB - This paper tests if second-price Vickrey auction (SPVA) and discrete choice experiment (DCE) are isomorphic, and whether lack of isomorphism is due to value elicitation, value-formation or both. We conduct an artefactual field experiment that combines induced-value (IV) and home-grown (HG) procedures using SPVA and DCE. Induced-value preferences are elicited for tokens and HG preferences for multi-attribute lasagnes. Attributes are healthiness and environmental sustainability. Our results suggest that HG preferences differ across elicitation methods. This discrepancy is due to value-elicitation and value-formation. DCE is the most demand revealing approach and provides the highest premiums for healthy and environmentally sustainable lasagnes.

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Value-elicitation and value-formation properties of discrete choice experiment and experimental auctions

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Jennie Macdiarmid

Verity Watson

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