Identifying the warm glow effect in contingent valuation

This paper reports the results from a contingent valuation study designed to investigate the influence of warm glow in willingness to pay (WTP) responses. Interindividual differences in warm glow motivation are measured through a factor analysis, performed on a list of attitudinal items. The reported (WTP) measures fail to pass the scope test. Both socioeconomic variables and motivational factor scores are significant in the explanation of the individual WTP measures. We compute “cold” WTP measures by taking out the effect of the warm glow motivation. These “cold” measures satisfy both the scope test and Hausmanʹs adding-up property.