[1] This is in contrast to willingness to pay (WTP), which is the maximum amount of money a consumer (a buyer) is willing to sacrifice to purchase a good/service or avoid something undesirable.
Contingent Value techniques are also common and directly ask respondents what they would be willing to accept for different hypothetical scenarios.
The standard assumptions of economic theory imply that with the absence of income effects, there is no difference between WTA and WTP.
This leads to the wide acceptance of the Coase theorem assertion that, subject to income effects, the allocation of resources will be independent of the assignment of property rights when costless trades are possible.
Contingent valuation is a common method in identifying how consumers value various things like healthcare, safety and the environment.
Given prior acceptance and acknowledgment of the endowment effect, it comes at little surprise that the WTA and WTP return differing results.
The WTA method makes the subjects sure that if they are losing any level of consumption, that they may want considerable sums of money in order to offset the loss of goods.
The WTP on the other hand leads subjects to believe that losing money may not be worth the additional unit of the good.
The WTA (and WTP) measures then push for people to think about the potential ownership of goods and services and is seemingly enough to trigger an endowment effect and subsequently alter the reference point.