Some further experimental results on hypothetical versus real willingness to pay

Abstract

In a previous experiment the null hypothesis of no difference between real and hypothetical willingness to pay for a box of chocolate could not be rejected. In this study we carry out a second experiment to see if we can confirm that finding. The experimental subjects are randomly divided into two groups. One group receives an open-ended hypothetical willingness to pay question and another group participates in a second-price auction with real payments. The mean willingness to pay is SEK 133.33 (STD 78.78) in the hypothetical payment group and SEK 81.62 (STD 62.99) in the real payment group, and the hypothesis of no difference in the mean willingness to pay between the groups can be rejected on the 10% level. In contrast to the first experiment the study thus gives some support for the notion that hypothetical willingness to pay questions overestimates real willingness to pay.