Lumpy preference structures

A widely held and durable normative position has been that policy analysts should attempt to estimate the evaluative reaction of those who will be most directly affected by a government sponsored or regulated technology. The premise of applied welfare economics is that citizens would divide, substitute and additively recombine their assessments of the project's impacts in the same manner. This paper outlines an alternative theory by arguing that citizen preferences will often be contingent upon, rather than divisible from, the substantive and procedural characteristics of the context in which a choice takes place. Moreover, one can predict that the manner in which these evaluations are substituted and recombined will vary with the internal structure of one's value and belief system. By representing that system in terms of a hierarchical model composed of four factors — common orientation, procedural judgment, desire for personal control and substantive evaluation — it is argued that the evaluations of a project will be combined by way of interactive, indirect and non-recursive relationships as well as the common additive expectations. Some of the implications of this alternative theory for policy analysis are explored.