ABSTRACT
Three basic approaches have been developed and applied to measure benefits of non-market goods: use of data on actual market behavior such as travel costs and property values, use of data from hypothetical or contingent market surveys, and use of data from simulated market games using real money. The most widely used of the hypothetical or contingent market techniques is contingent bidding. Bidding methods are, by nature, quite simple and are open to various forms of bias by individual respondents and survey researchers. The contingent ranking methodology is founded in the Lancastrian theory of consumer behavior and consumer preferences. This theory, which is based on a substantial body of literature in economics, psychometrics, and consumer research, attempts to describe how consumers choose from among similar products. The contingent ranking methodology requires data in the form of choices of products or alternatives, specified in terms of attributes, that are ordered according to individual preferences.
