Please use this identifier to cite or link to this item: http://hdl.handle.net/1893/2706
Appears in Collections:Economics Working Papers
Peer Review Status: Unrefereed
Title: Differences between Decision and Experienced Utility: An Investigation using the Choice Experiment method
Authors: Tinch, Dugald
Colombo, Sergio
Hanley, Nicholas
Contact Email: economics@stir.ac.uk
Citation: Tinch D, Colombo S & Hanley N (2010) Differences between Decision and Experienced Utility: An Investigation using the Choice Experiment method. Stirling Economics Discussion Paper, 2010-13.
Keywords: experienced utility
cost-benefit analysis
choice experiments
public goods
national parks
JEL Code(s): B10
D61
Q51
Issue Date: Nov-2010
Series/Report no.: Stirling Economics Discussion Paper, 2010-13
Abstract: Recent work by Kahneman and others has led to a new focus in economics on a wellbeing-based approach to utility. This suggests that ‘experienced utility’ is an alternative and more appropriate basis for the measurement of economic value compared with ‘decision utility’. In this paper, we apply the choice experiment technique to the valuation of changes in upland landscapes in the UK, in order to identify if experience in the moment or in memory impacts on the value associated with changes in ecosystem services under different management regimes. Four treatments are employed to measure decision utility, experienced utility, and remembered utility at two different time intervals. We show that our experienced utility treatment generates very different estimates of preferences than any of the other treatments. Whilst measurement of experienced utility is rife with difficulties, the approach taken allowed the identification of experiential impacts on utility and may have implications for the future use of experienced utility as a basis for the valuation of public goods.
Type: Working or Discussion Paper
URI: http://hdl.handle.net/1893/2706
Affiliation: Economics
IFAPA Centro Camino de Purchil
Economics

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