Inbehavioral economics, willingness to pay (WTP) is the maximum price at or below which a consumer will definitely buy one unit of a product.[1] This corresponds to the standard economic view of a consumer reservation price. Some researchers, however, conceptualize WTP as a range.
According to the constructed preference view, consumer willingness to pay is a context-sensitive construct; that is, a consumer's WTP for a product depends on the concrete decision context. For example, consumers tend to be willing to pay more for a soft drink in a luxury hotel resort in comparison to a beach bar or a local retail store.
In laboratory experiments auctions are conducted, a premise of the experiment is often that "bid = WTP".[2]
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