TY - JOUR AU - MAXIM, Alexandru AU - ROMAN, Teodora PY - 2019/10/01 Y2 - 2024/03/28 TI - The status quo’s role in improving the estimation of willingness to pay in choice experiments JF - European Journal of Sustainable Development JA - EJSD VL - 8 IS - 5 SE - DO - 10.14207/ejsd.2019.v8n5p422 UR - http://ojs.ecsdev.org/index.php/ejsd/article/view/952 SP - 422 AB - <p>European household consumers have seen a gradual increase in the cost of their electricity bill, partly due to ambitious support policies for the development of renewable energy. Some consumers may have a higher willingness to pay (WTP) for clean energy, which could constitute a competitive advantage for electricity suppliers branding themselves as “sustainable”.<br />A discrete choice experiment has been used in order to estimate the WTP of households for renewable energy. For the last decade, researchers have debated whether to add a “status quo” / “not willing to pay for changes” option in the experimental design, as this may generate complications and not add sufficient benefits.<br />In this paper we use an original approach based on two parallel model estimations applied to the same sample of respondents in order to demonstrate the effect of adding a “status quo” option. Our results show that not including it would have led to an overestimation of about one third of the respondents‟ WTP.<br />While more research on the topic is needed, we demonstrate the risk of simplifying the experimental design and propose a facile method of enhancing the experiment with a dual model design.<br /><em><strong></strong></em></p><p><em><strong>Keywords</strong></em>: discrete choice experiment, status quo, renewable energy, household consumers, willingness to pay</p> ER -