Improving the performance of contingent valuation studies in developing countries

This paper discusses three main reasons why so many of the contingent valuation studies conducted in developing countries are so bad. First, the contingent valuation surveys themselves are often poorly administered and executed. Second, contingent valuation scenarios are often very poorly crafted. Third, few CV studies conducted in developing countries are designed to test whether some of the key assumptions that the researcher made were the right ones, and whether the results are robust with respect to simple variations in research design and survey method. The paper concludes that research on stated preference methods in developing countries is critically important to the successful implementation of these methods because (1) there is no empirical evidence to suggest that rapid, "streamlined'' CV surveys yield reliable, accurate results, and (2) there is a significant risk that the current push for cheaper, simpler CV studies could discredit the methodology itself. Moreover, the policy debates to which CV researchers are asked to contribute are often of tremendous importance to the well-being of households in developing countries. Because the costs of policy mistakes can prove tragic, it is critical that VC researchers push for excellence in this research enterprise and that funding agencies think more carefully about the value of policy-relevant information in the fields in which the contingent valuation method is being used to study household preferences and behavior (e.g., water and sanitation services, urban air pollution, soil erosion, deforestation, biodiversity, watershed management, ecosystem valuation, vaccines for the poor).