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Comparing Open‐Ended Choice Experiments and Experimental Auctions: An Application to Golden Rice
Author(s) -
Corrigan Jay R.,
Depositario Dinah Pura T.,
Nayga Rodolfo M.,
Wu Ximing,
Laude Tiffany P.
Publication year - 2009
Publication title -
american journal of agricultural economics
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 1.949
H-Index - 111
eISSN - 1467-8276
pISSN - 0002-9092
DOI - 10.1111/j.1467-8276.2009.01267.x
Subject(s) - economics , willingness to pay , common value auction , economic surplus , valuation (finance) , econometrics , microeconomics , vickrey auction , price elasticity of demand , contingent valuation , auction theory , welfare , finance , market economy
We use two experimental valuation methods to estimate consumer demand for genetically modified golden rice. The first is an open‐ended choice experiment (OECE) where participants name the quantities of golden rice and conventional rice demanded at each of several price combinations, one of which will be randomly chosen as binding. This allows us to estimate market demand by aggregating demand across participants. This estimate of market demand also allows us to estimate own‐price elasticity and consumer surplus for golden rice. Comparing willingness‐to‐pay (WTP) estimates from the OECE with those from a uniform‐price auction, we find that OECE WTP estimates exhibit less affiliation across rounds, and the effects of positive and negative information under the OECE are more consistent with prior expectations and existing studies. We also find that, while auction WTP estimates more than double across five rounds, OECE WTP estimates are stable across rounds and are always roughly equal to those from the final auction round.