The Extent of Hypothetical Bias in Willingness to AcceptJEL codes

Hypothetical bias (HB) is often considered a main source of weakness for valuation surveys of any kind and the bias is thought to be even stronger if the valuation process is framed as willingness to accept (WTA) rather than willingness to pay (WTP). Using data collected after reviewing both published and unpublished articles, we conduct a meta-analysis of whether and to what extent WTA studies may have HB. Out of the eighty-six records from twenty-one studies that used WTA elicitation methods in both hypothetical and real elicitations, one study appears to have influenced the perception of extreme HB in WTA. Most exhibit no evidence of HB or evidence that it is a less severe problem for hypothetical WTA studies compared to historic patterns for WTP studies. We then conduct a field experiment eliciting both hypothetical and real WTA for a container of honey. Results show no evidence of HB based on no significant difference in WTA between the two treatments. Our findings challenge the long-held belief to avoid WTA elicitations for fear of exaggerated economic values and associated HB.