LAUSR

Abstract The contingent valuation method (CV) has become a recognised tool for estimating monetary non-market values. Despite the pragmatic acceptance of CV in policy evaluation, the application of CV-based estimates in decision-making remains controversial, as critics argue that CV suffers of hypothetical bias and question its accuracy to reflect non-market values via willingness to pay (WTP) estimates. In this paper we approach the assessment of CV accuracy from a double perspective. First, we assess validity and reliability by comparing CV-based WTP estimates and real monetary contributions to a crowdfunding initiative. Second, we assess construct validity identifying whether changing individual preferences are driven by strictly rational economic behaviour or by other factors that are not consistent with it. For this purpose, we conduct regression analysis using a synthetic panel dataset constructed from two contingent valuation surveys using the Propensity Score Matching method. Our findings suggest that WTP estimates are suitable to infer the economic value of environmental assets. This evidence points towards non-market valuation methods being capable of eliciting rational behaviour from individuals that is free of hypothetical bias. However, hypothetical bias might be lurking in a less researched area, that of market participation, which calls for a rigorous treatment of protest behaviour.