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The willingness to pay-willingness to accept gap: a failed replication of Plott and Zeiler
[working paper]
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Wissenschaftszentrum Berlin für Sozialforschung gGmbH
Abstract We report on experiments to replicate Plott and Zeiler's (2005) findings that the WTP-WTA gap disappears when using procedures that are aimed at reducing misunderstandings, such as training rounds for the BDM mechanism. Following the design by Plott and Zeiler (2005) and Isoni, Loomes, and Sugden (2... view more
We report on experiments to replicate Plott and Zeiler's (2005) findings that the WTP-WTA gap disappears when using procedures that are aimed at reducing misunderstandings, such as training rounds for the BDM mechanism. Following the design by Plott and Zeiler (2005) and Isoni, Loomes, and Sugden (2011) who re-ran the Plott/Zeiler experiments to study the paid practice rounds with lotteries, we replicate the findings from the lottery tasks where a WTP-WTA gap is present in all studies. However, unlike in the two previous studies the WTP-WTA gap does not disappear in the main task where subjects state their WTA or WTP for a mug. We introduce two additional lottery tasks to classify subjects and find that even for the most rational group of subjects who never make dominated choices in the paid practice rounds, the WTP-WTA gap in the mug task exists. The findings are replicated in a similar experiment with USB sticks instead of mugs. (author's abstract)... view less
Keywords
buying behavior; decision making; economic behavior; rationality
Classification
Basic Research, General Concepts and History of Economics
Free Keywords
WTP-WTA Lücke; BDM-Mechanismus; Missverständnis
Document language
English
Publication Year
2015
City
Berlin
Page/Pages
37 p.
Series
Discussion Papers / Wissenschaftszentrum Berlin für Sozialforschung, Forschungsschwerpunkt Markt und Entscheidung, Abteilung Verhalten auf Märkten, SP II 2015-204
Handle
https://hdl.handle.net/10419/108946
Status
Published Version; reviewed
Licence
Deposit Licence - No Redistribution, No Modifications