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The relationship between individual and household measures of WTP and WTA

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  • Udo Ebert
Abstract
The article defines measures of individual and household willingness to pay (and to accept) in a general and flexible framework. It completely clarifies the relationship between the household measures and the sum of the individual welfare measures (the aggregate measures) which are in general different. The aggregate measures form only an upper bound for the corresponding household measures. The bounds (based on the information about individual measures) can be tightened by introducing additional assumptions about the decision process within the household. The results derived prove helpful for the theoretical analysis of household behavior, for the evaluation of nonmarket goods in environmental and public economics and for contingent valuation. Copyright Springer-Verlag 2013

Suggested Citation

  • Udo Ebert, 2013. "The relationship between individual and household measures of WTP and WTA," Social Choice and Welfare, Springer;The Society for Social Choice and Welfare, vol. 40(2), pages 367-390, February.
    • Handle: RePEc:spr:sochwe:v:40:y:2013:i:2:p:367-390
    DOI: 10.1007/s00355-011-0607-5
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    2. Martina Menon & Federico Perali & Marcella Veronesi, 2014. "Recovering Individual Preferences for Non-Market Goods: A Collective Travel-Cost Model," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 96(2), pages 438-457.
    3. Blignaut, James & Mander, Myles & Inglesi-Lotz, Roula & Glavan, Jane & Parr, Stephen, 2016. "The amenity value of Abu Dhabi's coastal and marine resources to its beach visitors," Ecosystem Services, Elsevier, vol. 19(C), pages 32-41.

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