Willingness to Accept, Willingness to Pay and the Income Effect

@article{Horowitz2001WillingnessTA,
  title={Willingness to Accept, Willingness to Pay and the Income Effect},
  author={John K. Horowitz and Kenneth E. McConnell},
  journal={Behavioral \& Experimental Economics},
  year={2001}
}
The disparity between willingness to pay and willingness to accept in experimental and survey settings remains a troubling anomaly. Willingness-to-accept is almost always higher than WTP, often substantially higher. Our interest lies with the neoclassical explanation of Hanemann, who demonstrates that for exogenous quantity changes, the difference between WTP and WTA depends ratio of the ordinary income elasticity of demand for the good to the Allen-Uzawa elasticity of substitution between the… 

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