A little knowledge can be a dangerous thing. At least Eliezer has previously often recommended Judgment Under Uncertainty as something people should read. Now, I’ll admit I haven’t read it myself, but I’m wondering if that might be a bad advice, as the book’s rather dated. I seem to frequently come across articles that cite JUU, but either suggest alternative interpretations or debunk its results entirely.
Psychological explanations of scope insensitivity do not imply CV invalidation. Green and Tunstall (1999, p. 213) argue that observed scope insensitivity (part-whole bias, embedding) “is the result of asking questions which are essentially meaningless to the respondents because [of] false assumptions about the cognitions of the respondents”. This position is close to that of, e.g., Carson and Mitchell (1993), arguing that apparent scope insensitivity is primarily due to flaws in survey design leading to amenity misspecification bias.
There are also explanations from economic theory. Rollins and Lyke (1998) argue that observed insensitivity to scope can result from diminishing marginal values. Successive quantities of, e.g., protected areas would receive ever positive but lower values per unit, such that the possibility of observing scope sensitivity would depend on the baseline scarcity of the resource. Income effects provide a related explanation. CV respondents have limited budgets or sub-budgets, whether these are mental or real, so their optimisation of spending on private and public goods is constrained (Randall and Hoehn 1993, 1996). Thus, even if the valuation is hypothetical, respondents are expected to limit totally stated [Willingness to Pay] to their ability to pay and to account for an executed hypothetical purchase when asked to value another good.
Indeed, the scope sensitivity issue remains controversial...
The scope test in the present CV study was over the composition of endangered species preservation. … Of four external tests of insensitivity to scope, one was rejected, two gave mixed results, depending on either the type of test or elicitation format, and for the last one the null hypothesis could not be rejected. Of five internal tests, insensitivity to scope was rejected in three cases, one test gave mixed results, and one could not be rejected. Survey design features of the CV study, especially a fuzzy subgroup of endangered species, could explain the apparent insensitivity to scope observed.
So if anyone is reading the book, take it with a grain of salt. At least do a Google Scholar search for more data before accepting the conclusions.
A little knowledge can be a dangerous thing. At least Eliezer has previously often recommended Judgment Under Uncertainty as something people should read. Now, I’ll admit I haven’t read it myself, but I’m wondering if that might be a bad advice, as the book’s rather dated. I seem to frequently come across articles that cite JUU, but either suggest alternative interpretations or debunk its results entirely.
Just today, I was trying to find recent articles about scope insensitivity that I could cite. But on a quick search I primarily ran across articles pointing out it isn’t so clear-cut as we seem to assume:
So if anyone is reading the book, take it with a grain of salt. At least do a Google Scholar search for more data before accepting the conclusions.