Payment and Policy Consequentiality in Dichotomous Choice Contingent Valuation: Experimental Design Effects on Self-Reported Perceptions
8
Citation
0
Reference
10
Related Paper
Citation Trend
Abstract:
Although the contingent valuation literature emphasizes the importance of controlling for respondents' consequentiality perceptions, this literature has rarely accounted for the difference between payment and policy consequentiality. We examine the influence of a randomly assigned tax amount on consequentiality self-reports and their potential endogeneity using data from a single dichotomous choice survey about reducing marine plastic pollution in Norway. Results show that consequentiality perceptions are a function of the tax amount, with payment consequentiality decreasing and policy consequentiality increasing with higher tax amounts. We discuss the challenge of finding valid instruments to address the potential endogeneity of consequentiality perceptions.Keywords:
Endogeneity
Contingent valuation
Abstract This article outlines the current situation with respect to ‘endogeneity and structural equation estimation’. It begins by exploring why econometrics, and particularly the treatment of endogeneity, proved so valuable for political scientists. The most prominent methods used to deal with endogeneity are explained. The article also includes a critique of the critical conditions needed to support the use and interpretation of this method and discusses frequently used diagnostics developed to assess the severity of the problems. The estimation method and diagnostics are shown with a running example with data from a previous study of US congressional politics. In many instances, empirical evidence will continue to be the classic observational study, replete with endogeneity problems. Rather than forgoing analyses of these data and questions because of the reservations about a particular method, it is better to use and to improve those methods in the context of these studies and data.
Endogeneity
Cite
Citations (14)
This paper explicitly models the endogeneity of state life insurance policy in the dynamics of the early American life insurance population. It finds strong evidence of endogeneity and demonstrates that the true effects of public policy on organizational populations are only evident when endogeneity is accounted for.
Endogeneity
Cite
Citations (0)
Addressing endogeneity can be a challenging task given the different sources of endogeneity and their impacts on empirical results. While premier business journals typically expect authors to rigorously address endogeneity, this expectation is relatively new to many Operations Management (OM) scholars, as exemplified by a recent editorial in Journal of Operations Management that calls for more rigorous treatment for endogeneity. This study serves two purposes. First, we summarize recent OM literature with respect to the treatment for endogeneity by reviewing studies published in leading OM journals between 2012 and 2017. The review provides evidence that endogeneity problems have received increasing attention from OM scholars. However, we also find some common problems that may render the chosen techniques for addressing endogeneity less effective and potentially lead to biased analysis results. Second, since instrumental variable regression is the most prevalent technique for dealing with endogeneity in the OM literature according to our review, we provide an empirical illustration tailored to OM researchers for using instrumental variable regression in the post-design (data analysis) phase. Using variables from a publicly available healthcare dataset, our analysis sheds light on the importance of examining instruments' quality and triangulating results based on more than one test/estimator.
Endogeneity
Instrumental variable
Empirical Research
Cite
Citations (0)
Endogeneity
Instrumental variable
Publication
Causality
Cite
Citations (227)
Abstract Chenhall and Moers (European Accounting Review, this issue, pp. 173–195) provide an excellent overview of the econometrics of endogeneity. In response to their discussion I argue that researchers should be courageous enough to set aside endogeneity concerns when their research question is important. Theory does not admit a definite answer to the question whether endogeneity is present in a particular model and econometrics has few technical solutions to offer. Since we cannot be sure endogeneity exists, and if we were to be sure of its existence, there is little we can do about it, researchers are well advised to move on to more serious problems.
Endogeneity
Aside
Instrumental variable
Cite
Citations (51)
This paper investigates the growing need to control for endogeneity in corporate social responsibility (CSR) research. We modify the theoretical constructs of a neoclassical production function to include CSR and in doing so provide theoretical evidence of endogeneity in the estimation equation. We find that failure to empirically control for endogeneity leads to results that suggest CSR has a negative impact on firm production. However, when controlling for endogeneity through a two‐stage approach, the negative impact disappears. Moreover, we demonstrate the efficacy of using a proven theoretical estimation technique to include CSR and, therefore, mitigate endogeneity concerns.
Endogeneity
Control function
Production function
Cite
Citations (1)
Endogeneity
Instrumental variable
Variables
Cite
Citations (1)
In this paper, QUAIDS analysis was carried out to examine the demand system of vegetables in the Philippines, with casting light on the endogenous issues for a more rigorous discussion. As a result of comparing the model controlling for the endogeneity and the model without controlling for the endogeneity, the percent difference between elasticities of two models was shown up to 187%. This result suggests that price and expenditure endogeneities have a significant influence on estimates in the demand system, and the result implies that this may lead to inconsistent estimates when demand analysis does not control for endogeneity.
Endogeneity
Instrumental variable
Cite
Citations (0)
Abstract Addressing endogeneity can be a challenging task given the different sources of endogeneity and their impacts on empirical results. While premier business journals typically expect authors to rigorously address endogeneity, this expectation is relatively new to many Operations Management (OM) scholars, as exemplified by a recent editorial in Journal of Operations Management that calls for more rigorous treatment for endogeneity. This study serves two purposes. First, we summarize recent OM literature with respect to the treatment for endogeneity by reviewing studies published in leading OM journals between 2012 and 2017. The review provides evidence that endogeneity problems have received increasing attention from OM scholars. However, we also find some common problems that may render the chosen techniques for addressing endogeneity less effective and potentially lead to biased analysis results. Second, since instrumental variable regression is the most prevalent technique for dealing with endogeneity in the OM literature according to our review, we provide an empirical illustration tailored to OM researchers for using instrumental variable regression in the post‐design (data analysis) phase. Using variables from a publicly available healthcare dataset, our analysis sheds light on the importance of examining instruments' quality and triangulating results based on more than one test/estimator.
Endogeneity
Instrumental variable
Empirical Research
Cite
Citations (218)
Abstract The welfare of farm animals is a policy area that has increased greatly in importance in recent years. When deciding whether a proposed policy should be implemented, it can be useful for policymakers to compare the costs of the proposed improvement with the perceived benefits. The costs are relatively straightforward to calculate but little is known about the benefits. The Contingent Valuation Method (CVM), a direct survey-based method, can be used to shed some light on this. This approach elicits the willingness-to-pay (WTP) for the provision of some public good or service. This paper reports the results of a contingent valuation study of the value of welfare improvements for growing pigs. Attitudes and opinions with regard to farm animal welfare are explored and WTP elicited for various pig welfare improvements including increases in space allowance, environmental enrichment and research into improved pig housing design. The results reveal a positive WTP for these improvements. However, it is also noteworthy that a significant proportion of the general public is willing to pay nothing for these improvements. Overall, the study illustrates the usefulness of the CVM approach as a tool for policymakers in assessing the merits of possible policy initiatives affecting the welfare of animals.
Contingent valuation
Allowance (engineering)
Value (mathematics)
Cite
Citations (28)