SELF IMAGE AND CHOICE EXPERIMENTS: HYPOTHETICAL AND ACTUAL WILLINGNESS TO PAY

Abstract

This paper proposes that people derive utility from a positive self-image, influenced by ethical views, internal honesty, and consistency between sequential choices. A model is tested by conducting the same choice-experiment for two WWF-campaigns in three different contexts. It predicts that marginal WTP for contributions to these campaigns is highest when choices are hypothetical, lower in a real-money experiment that follows a hypothetical experiment, and lowest when real-money choices are made directly. Additionally, it predicts that marginal WTP decreases with the scale of financial incentives in a real-money experiment. The empirical results are consistent with these hypotheses.