hypothetical bias

Hypothetical bias is a type of bias that can occur in contingent valuation surveys, a method used to determine the value people place on environmental goods. This bias arises because respondents may not answer truthfully or accurately when presented with hypothetical scenarios, as they are not facing real-world consequences for their answers.

This can lead to inaccurate valuations, as individuals might overstate or understate their willingness to pay for environmental improvements. To mitigate hypothetical bias, surveyors may use laboratory settings or experimental techniques that mimic real-world financial situations to encourage more realistic responses.1