Bayesian conjoint choice designs for measuring willingness to pay
Vermeulen, B. Goos, P., Scarpa, R. & Vandebroek, M. (2010). Bayesian conjoint choice designs for measuring willingness to pay. Environmental and Resource Economics, 48(1), 129-149.
Permanent Research Commons link: https://hdl.handle.net/10289/4665
In this paper, we propose a new criterion for selecting efficient conjoint choice designs when the interest is in quantifying willingness to pay (WTP). The new criterion, which we call the WTP-optimality criterion, is based on the c-optimality criterion which is often used in the optimal experimental design literature. We use a simulation study to evaluate the designs generated using the WTP-optimality criterion and discuss the design of a real-life conjoint experiment from the literature. The results show that the new criterion leads to designs that yield more precise estimates of the WTP than Bayesian D-optimal conjoint choice designs, which are increasingly being seen as the state-of-the-art designs for conjoint choice studies, and to a substantial reduction in the occurrence of unrealistically high WTP estimates.
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