? A suitable scale ? An examination of the Purchase Model and Contribution Model

Many mainstream economists and policy experts assume that Contingent Valuation (CV) methodologies report a legitimate monetary valuation of a social proposal. An alternative interpretation put forward by Kahneman and colleagues suggest that responses to CV surveys represent a general offer of contribution towards a social project. The contribution model framework conceptualises Willingness to Pay (WTP) questions as measuring psychological attitudes rather than economic utility. The headline method studies are the core empirical evidence used to support the alternative interpretation. The headline method studies have been heavily criticised for using a group level methodological design to draw psychological conclusions. The current study examined the relationship between responses to attitudinal scales and Willingness to Pay (WTP) questions at an individual level, thus avoiding the problems associated with cross-level inference. The current study found a strong relationship between attitudinal measures and the type of bid offered (zero bid or positive bid). At the same time, non-attitudinal variables such as subjective norms and perceived ability to pay were also found to significantly predict the type of WTP bid offered. This suggests that the type of WTP bid offered is a function of a general psychological appraisal, reflecting a broader assessment than an attitude based judgement. The psychological variables (attitude and non-attitude variables) were found to have a weak relationship with the amount of money offered by positive bidders, supporting the claim by Kahneman and colleagues that the dollar scale is a psychometrically poor measure. The current paper examined the WTP responses of the positive bidders. While Kahneman and colleagues assume that there are large differences in how people use the dollar scale, the current study found that the majority of positive bidders offered a WTP amount that corresponded with a standardised currency value, with £5 and £10 being especially popular bids. Such a response distribution proves strong evidence that the majority of CV respondents offer WTP bids based on contributory rather than economic motives. Introduction The Contingent Valuation (CV) method is a controversial approach commonly employed to estimate the monetary value of an actual or proposed social change. Many economists are adamant that a well designed and properly administered CV survey will result in a reasonably reliable estimation of the “true” monetary valuation of a social proposal (e.g. Mitchell & Carson, 1989; Harrison, 1992; Smith, 1994). Such economists contend that if you ask “How much would you be being willing to pay for X improvement” or “Would you be willing to pay Y amount for X improvement” under the right conditions, participants will readily provide a meaningful response that reflects their personal monetary valuation of the proposal. This approach assumes that people are not only capable of comparing the utility of the