Contingent valuation (CV) measures what is called passive use value or
existence value. The CV method has been used to measure the benefits of
environmental policy actions. CV measures of economic value rely on
choice. In CV studies, choices are posed to people in surveys; analysts
then use the responses to these choice questions to construct monetary
measures of value. The specific mechanism used to elicit respondents'
choices can take a variety of forms, including asking survey respondents
whether they would purchase, vote, or pay for a program or some other
well-defined object of choice. It can also be a direct elicitation of
the amount each respondent would be willing to pay (WTP) to obtain an
object of choice or the amount each respondent would be willing to
accept (WTA) in compensation to give it up.
This volume is composed of three sections. The first section provides
background into the issues underlying the public and academic discussion
regarding CV and the reliability of CV estimates of economic value. In
addition, this section reviews the theory underlying the measurement of
economic value and discusses those aspects of the theory most relevant
to CV. The second section focuses on issues that have formed the core of
the CV discussions including: sensitivity of WTP estimates to the size
of the program offered, tests for theoretical consistency of CV results,
and the sensitivity of results to context and numerous other features of
the survey and its administration. The final section addresses the
application of CV to actual economic valuation tasks and discusses the
types of practical problems the CV researcher will encounter.
