The Effect of Power Outages and Cheap Talk on Willingness to Pay to Reduce Outages
Copyright policy )The Effect of Power Outages and Cheap Talk on Willingness to Pay to Reduce Outages
Using an open-ended contingent valuation survey, we analyze how (i) experience of a power outage due to one of the worst storms ever to hit Sweden and (ii) a cheap talk script affect respondents' WTP to avoid power outages. Experience significantly increases and a cheap talk script significantly decreases the proportion of respondents with zero WTP, and as a result stated WTP is lower with experience and the cheap talk script. The paper concludes with a discussion on the use of valuation studies shortly after the occurrence of an undesirable event. (C) 2011 Published by Elsevier B.V.
- Institute for the Study of Labor Germany
- University of Gothenburg Sweden
Q41, ddc:330, Kommunikation, contingent valuation, cheap talk, experience, power outages, experience, power outages, D12, Betriebliche Störung, Informationsverhalten, C25, Willingness to pay, Contingent valuation, cheap talk, Elektrizitätswirtschaft, Schweden, jel: jel:D12, jel: jel:C25, jel: jel:Q41
Q41, ddc:330, Kommunikation, contingent valuation, cheap talk, experience, power outages, experience, power outages, D12, Betriebliche Störung, Informationsverhalten, C25, Willingness to pay, Contingent valuation, cheap talk, Elektrizitätswirtschaft, Schweden, jel: jel:D12, jel: jel:C25, jel: jel:Q41
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