Economists have a tradition of analyzing consumer behavior to determine what individuals would be willing to pay (WTP) for a commodity. Gaining wider acceptance is an alternative methodology that directly asks consumers what they would be willing to pay. Obtaining WTP amounts by analyzing behavior is referred to as revealed preferences (WTPRP), while the survey counterpart is called contingent valuation (WTPCV). As it implies, contingent valuation requires the respondent to place a monetary value on a specific good without having to actually make the purchase.
Contingent valuation is often used by health services researchers to get patients to value non-market goods or hypothetical treatments. Researchers can, for example, ask patients to value a hypothetical preventive asthma treatment that reduces the frequency of symptoms. The expectation is that people would be willing to spend some of their money to obtain the good — the more they value the good, the more they are willing to pay. In theory, one’s maximal willingness to pay represents the point where the marginal utility from having the money is equal to the marginal utility of the good being valued.
The use of WTPCV
(hereafter referred to as WTP) is not without controversy. Advocates usually note that the metric underlying WTP is money, something with which everyone is familiar. Economists also often tout that willingness to pay adheres to welfare economics, enabling decisions based on production efficiency (Ref. [1
], p. 208). Interpersonal comparisons of utility are possible by treating money as a ratio scale. Yet, critics say that comparing different individuals’ responses can be dangerous because people with more money are often willing and able to spend more. This issue, perhaps more than any other, makes many researchers uncomfortable with willingness to pay as a measure of benefit.
Although the WTP literature continues to expand, four salient points are apparent from reviewing the literature. First, as WTP has been developing as a methodology, most studies have relied on convenience samples. Consequently, samples usually draw on middle/upper class whites who speak English. Few studies even report race or ethnicity when describing the sample. Exceptions include Ramsey et al. [2
] and O’Conor and Blomquist [3
]. However, both of these samples were more than 85% white.
Second, most studies that used postal surveys had a significant percentage of incomplete data. Reported response rates have been as low as 45% [4
]. Higher response rates were more typical among interviewer-administered surveys, which, for practical reasons, tend to be less common than postal surveys. Some believe that the incomplete data reflects distrust or discomfort when asked these questions. Such non-response is common when asking about household income. Yet the wide range of incomplete data suggests that these questions are not only objectionable to some patients, but that some WTP questions are probably confusing as well. Interestingly, few studies reported undertaking formative research to ensure the WTP question was clear and understandable to the target audience.
Third, in most WTP studies in medicine, respondents are asked to value a hypothetical medicine or medical procedure that will improve the individual’s health status by alleviating symptoms. Examples include paying for reductions in urinary incontinence symptoms [5
] or reductions in angina symptoms [6
]. Researchers are starting to branch out and ask WTP about other issues. One study, for example, asked people what they would be willing to pay for autologous blood donations to reduce the risk of contracting blood-borne illnesses [4
Fourth, as mentioned above, there is a consistent positive relationship between WTP and ability to pay, as measured by household income. This is a predicted relationship according to economic theory. In fact, this association is often used as an internal validation check of the underlying economic model [7
]. Yet many health practitioners are uncomfortable using a measure of benefit that varies so dramatically by household income. Some of these concerns can be handled statistically by adjusting for household income. However, concerns persist about the validity of WTP with very low income persons. Is WTP meaningful when the respondents have no ability to pay? People with very low incomes might perceive money very differently than those with more economic resources, making it difficult to compare these groups. Understanding WTP among persons with very low income is just starting to be addressed [8
This study relates to all four issues by reporting on the development and pilot testing of a willingness to pay question for mammography. Developing the WTP item arose as preliminary work for a much larger randomized clinical study, now underway, to increase mammography and pap smear screening. The development process started with focus groups and individual interviews with low income women representing five race/ethnic groups (African American, Chinese, Filipino, Latino, and white) and four languages (English, Chinese, Spanish and Tagalog). The validity of willingness to pay question was then tested with a random sample of low income, ethnically diverse women.