Complexity in choice experiments: choice of the status quo alternative and implications for welfare measurement*

Abstract

We examine the propensity of respondents to choose the status quo (SQ) or current situation alternative as a function of complexity in two separate state-of-the-world choice experiments. Complexity in each choice set was characterized as the number of single and multiple changes in levels of attributes from the current situation and the order of the choice task in the sequence of multiple tasks provided to respondents. We show that increasing complexity leads to increased choice of the SQ and that a respondent's age and level of education also influenced this choice. We outline the effects of the alternate approaches for incorporating the SQ into welfare measurement. These findings have implications for the design of stated preference experiments, examining passive use values and for empirical analysis leading to welfare measurement.

Investigating fishers’ preferences for the design of marine Payments for Environmental Services schemes

“…Status quo bias is well documented within the CE decision making literature (Boxall et al, 2009;Samuelson and Zeckhauser, 1988). When faced with choices between new alternatives and the status quo, individuals unduly choose the current situation.…”

“…The ASC can account for unobserved attributes which are known to the individual but not the researcher as well as a 'pure' preference for the current situation (Boxall et al 2009;Bennett & Blamey 2001). (8) When: Table 7 displays the economic surplus of all possible combinations of management strategies associated with the various PES management scenarios.…”

Households Preferences and Willingness to Pay for Watershed Services Attributes in North Selangor Peat Swamp Forest Malaysia

“…The combination (two options and one status quo) has been employed by many analysts in Choice Experiments e.g. (Bergmann et al, 2008;Boxall et al, 2009). An Example of the show cards used in the research.…”

Test–Retest Reliability of Choice Experiments in Environmental Valuation

“…Ferrini and Scarpa 2007;Lusk and Norwood 2005), the choice task complexity (e.g. DeShazo and Fermo 2002;Boxall et al 2009) or the non-attendance to choice attributes (e.g. Hensher et al 2005;Campbell et al 2008) on welfare estimates.…”