What Have We Learned from 20 Years of Stated Preference Research in Less-Developed Countries?

Over the past two decades, hundreds of stated preference studies have been conducted in less-developed countries. This article examines what has been learned on the methodological front from stated preference research, and it summarizes the empirical evidence from stated preference studies about household preferences in less-developed countries. The main conclusion is that households' willingness to pay for a wide range of goods and services offered to respondents in stated preference scenarios is low, in both relative and absolute terms and in comparison to the costs of service provision. This article discusses why this finding is important for development professionals. The article also identifies what is missing from the literature on stated preference studies in less-developed countries.