The value of using stated preference methods: a case study in modelling water heater choices

The main stumbling block in estimating credible empirical models of appliance purchase decisions is the lack of suitable data. Appliance choice studies typically merely identify the relationships between appliance stocks and current home occupiers, and have little value for understanding the decision-making processes actually involved in the purchase of the appliance. In an attempt to overcome these problems, we argue that it is necessary to move away from the usual revealed preference sources and employ stated preference data collection methods. These arguments are made with specific reference to the design, collection and analysis of stated preference data for water heater choices using separate samples of Australian consumers and plumbers. The preferences of plumbers are important because of their role in advising consumers on alternative water heaters. (C) 2003 IMACS. Published by Elsevier B.V. All rights reserved.