Hostname: page-component-7b9c58cd5d-6tpvb Total loading time: 0 Render date: 2025-03-16T06:00:30.144Z Has data issue: false hasContentIssue false
  • English
  • Français

Elicitation using multiple price list formats

Published online by Cambridge University Press:  14 March 2025

Steffen Andersen ,
Glenn W. Harrison ,
Morten Igel Lau  and
E. Elisabet Rutström
Steffen Andersen*
Affiliation:
Centre for Economic and Business Research, Copenhagen Business School, Copenhagen, Denmark
Glenn W. Harrison*
Affiliation:
Department of Economics, College of Business Administration, University of Central Florida, USA
Morten Igel Lau*
Affiliation:
Department of Economics and Finance, Durham Business School, Durham University, United Kingdom
E. Elisabet Rutström
Affiliation:
Department of Economics, College of Business Administration, University of Central Florida, USA
*
e-mail: [email protected]
e-mail: [email protected]; [email protected]
e-mail: [email protected]
Get access Rights & Permissions [Opens in a new window]

Abstract

We examine the properties of a popular method for eliciting choices and values from experimental subjects, the multiple price list format. The main advantage of this format is that it is relatively transparent to subjects and provides simple incentives for truthful revelation. The main disadvantages are that it only elicits interval responses, and could be susceptible to framing effects. We consider extensions to address and evaluate these concerns. We conclude that although there are framing effects, they can be controlled for with a design that allows for them. We also find that the elicitation of risk attitudes is sensitive to procedures, subject pools, and the format of the multiple price list table, but that the qualitative findings that participants are generally risk averse is robust. The elicitation of discount rates appear less sensitive to details of the experimental design.

Keywords

ElicitationExperimentsRisk aversionDiscount rates

JEL classification

C9: Design of Experiments D81: Criteria for Decision-Making under Risk and Uncertainty D91: Role and Effects of Psychological, Emotional, Social, and Cognitive Factors on Decision Making‡
Type
Research Article
Information
Experimental Economics , Volume 9 , Issue 4 , December 2006 , pp. 383 - 405
Copyright
Copyright © 2006 Economic Science Association

Access options

Get access to the full version of this content by using one of the access options below. (Log in options will check for institutional or personal access. Content may require purchase if you do not have access.)

Footnotes

Electronic Supplementary Material Supplementary material is available in the online version of this article at http://dx.doi.org/10.1007/s10683-006-7055-6.

References

Andersen, S., Harrison, G. W., Lau, M. I., & Rutström, E. E. (2005a). Valuation using multiple price lists. Working Paper 05-07, Department of Economics, College of Business Administration, University of Central Florida. Applied Economics, forthcoming.Google Scholar
Andersen, S., Harrison, G. W., Lau, M. I., & Rutström, E. E. (2005b). Eliciting risk and time preferences. Working Paper 05-24, Department of Economics, College of Business Administration, University of Central Florida.Google Scholar
Beck, J. H. (1994). An experimental test of preferences for the distribution of income and individual risk aversion. Eastern Economic Journal, 20(2), 131–145.Google Scholar
Binswanger, H. P. (1980). Attitudes toward risk: Experimental measurement in rural India. American Journal of Agricultural Economics, 62, 395–407.CrossRefGoogle Scholar
Binswanger, H. P. (1981). Attitudes toward risk: Theoretical implications of an experiment in rural India. Economic Journal, 91, 867–890.CrossRefGoogle Scholar
Botelho, A., Harrison, G.W., Hirsch Marc, A., & Rutström, E. E. (2005). Bargaining behavior, demographics and nationality: What can the experimental evidence show? In Carpenter, J., Harrison, G.W. and List, J.A. (Eds.), Field Experiments in Economics. (Greenwich, CT: JAI Press, Research in Experimental Economics, Volume 10).Google Scholar
Coller, M., Harrison, G. W., & Rutström, E. E. (2003). Are discount rates constant? Reconciling Theory and Observation. Working Paper 3-31. Department of Economics, College of Business Administration, University of Central Florida.Google Scholar
Coller, M., & Williams, M. B. (1999). Eliciting individual discountrates. Experimental Economics, 2, 107–127.CrossRefGoogle Scholar
Cox, J. C., & Sadiraj, V. (2005). Implications of small- and large-stakes risk aversion for decision theory. Games & Economic Behavior, 53(2), forthcoming.Google Scholar
Eckel, C. C., & Grossman, P. J. (2002). Forecasting risk attitudes: An experimental study ofactual and forecast risk attitudes of women and men. Unpublished Manuscript. Department of Economics, Virginia Tech.Google Scholar
Gonzalez, R., & Wu, G. (1999). On the shape of the probability weighting function. Cognitive Psychology, 38, 129–166.CrossRefGoogle ScholarPubMed
Harrison, G. W., (1992). Theory and misbehavior of first-price auctions: Reply. American Economic Review, 82, 1426–1443.Google Scholar
Harrison, G. W., Harstad, R. M., & Rutström, E. E. (2004). Experimental methods and elicitation of values. Experimental Economics, 7(2), 123–140.CrossRefGoogle Scholar
Harrison, G. W., Johnson, E., McInnes, M. M., & Rutström, E. E. (2005). Risk aversion and incentive effects: Comment. American Economic Review, 95(3), 897–901.CrossRefGoogle Scholar
Harrison, G. W., Lau, M. I., Rutström, E. E., & Sullivan, M. B. (2005). Eliciting risk and time preferences using field experiments: Some methodological issues. In Carpenter, J., Harrison, G.W., & List, J.A., (Eds.), Field Experiments in Economics (Greenwich, CT: JAI Press, Research in Experimental Economics, Volume 10).CrossRefGoogle Scholar
Harrison, G. W., Lau, M. I., & Williams, M. B. (2002). Estimating individual discount rates for denmark: A field experiment. American Economic Review, 92(5), 1606–1617.CrossRefGoogle Scholar
Hoffman, E., Menkhaus, D. J., Chakravarti, D., Field, R. A., & Whipple, G. D. (1993). Using laboratory experimental auctions in marketing research: a case study of new packaging for fresh beef. Marketing Science, 12(3), 318–338.CrossRefGoogle Scholar
Holt, C. A., & Laury, S. K. (2002). Risk aversion and incentive effects. American Economic Review, 92(5), 1644–1655.CrossRefGoogle Scholar
Kahneman, D., Knetsch, J. L., & Thaler, R. H. (1990). Experimental tests of the endowment effect and the coase theorem. Journal of Political Economy, 98, 1325–1348.CrossRefGoogle Scholar
Kirby, K. N., & Marakovic, N. N. (1996). Delay-discounting probabilistic rewards: Rates decrease as amounts increase. Psychonomic Bulletin & Review, 3(1), 100–104.CrossRefGoogle ScholarPubMed
Kirby, K. N., Petry, N. M., & Bickel, W. K. (1999). Heroin addicts have higher discount rates for delayed rewards than non-drug-using controls. Journal of Experimental Psychology: General, 128(1), 78–87. Laury, S. K., & Holt, C. A. Further reflections on prospect theory. Working Paper.CrossRefGoogle ScholarPubMed
Miller, L., Meyer, D. E., & Lanzetta, J. T. (1969). Choice among equal expected value alternatives: Sequential effects of winning probability level on risk preferences. Journal of Experimental Psychology, 79(3), 419–423.CrossRefGoogle Scholar
Mitchell, R. C., & Carson, R. T. (1989). Using surveys to value public goods: The contingent valuation method. Baltimore, Johns Hopkins Press.Google Scholar
Murnighan, K. J., Roth, A. E., & Shoumaker, F. (1987). Risk aversion and bargaining: Some preliminary results. European Economic Review, 31, 265–271.CrossRefGoogle Scholar
Murnighan, K. J., Roth, A. E., & Shoumaker, F. (1988). Risk aversion in bargaining: An experimental study. Journal of Risk and Uncertainty, 1(1), 101–124.CrossRefGoogle Scholar
Rabin, M. (2000). Risk aversion and expected utility theory: A calibration theorem. Econometrica, 68, 12811292.CrossRefGoogle Scholar
Rutström, E. E. (1998). Home-grown values and the design of incentive compatible auctions. International Journal of Game Theory, 27(3), 427–441.Google Scholar
Supplementary material: File

Andersen et al. supplementary material

Instructions and Sample Design for the Danish Experiments
Download Andersen et al. supplementary material(File)
File 1.1 MB
Supplementary material: File

Andersen et al. supplementary material

Andersen et al. supplementary material 1
Download Andersen et al. supplementary material(File)
File 458 Bytes
Supplementary material: File

Andersen et al. supplementary material

Andersen et al. supplementary material 2
Download Andersen et al. supplementary material(File)
File 26.3 KB
Supplementary material: File

Andersen et al. supplementary material

Andersen et al. supplementary material 3
Download Andersen et al. supplementary material(File)
File 406.4 KB
Supplementary material: File

Andersen et al. supplementary material

Andersen et al. supplementary material 4
Download Andersen et al. supplementary material(File)
File 16 KB
Supplementary material: File

Andersen et al. supplementary material

Andersen et al. supplementary material 5
Download Andersen et al. supplementary material(File)
File 102.4 KB
Supplementary material: File

Andersen et al. supplementary material

Andersen et al. supplementary material 6
Download Andersen et al. supplementary material(File)
File 381.2 KB
Supplementary material: File

Andersen et al. supplementary material

Andersen et al. supplementary material 7
Download Andersen et al. supplementary material(File)
File 786 Bytes