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Methods of Environmental Valuation

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Handbook of Regional Science

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Abstract

Commensurate valuation of market and nonmarket public goods allows for a more valid benefit-cost analysis. Economic methods for valuing nonmarket public goods include actual behavior-based revealed preference methods, such as the hedonic property method for urban-suburban public goods and travel cost models for outdoor recreation. For valuing proposed public goods for which there is no current behavior, or valuing the existence or passive use values of public goods, economists can rely on stated preference methods. While there is skepticism among some economists for relying on what people say they will pay rather than what their actual behavior suggests they will pay, there is general acceptance of stated preference methods. These stated preference methods include the well-known contingent valuation method and choice experiments (sometimes called conjoint analysis). Lastly, in situations where there is neither time nor money to conduct an original revealed or stated preference study, economists can rely on benefit transfers from existing revealed preference and stated preference studies to provide rough estimates of the values of public goods such as water quality, air quality, wetlands, recreation, and endangered species.

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Notes

  1. 1.

    Any use of trade, firm, or product names is for descriptive purposes only and does not imply endorsement by the U.S. government.

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Author information

Authors and Affiliations

  1. Department of Agricultural and Resource Economics, Colorado State University, Fort Collins, CO, USA

    John Loomis

  2. U.S. Geological Survey, Fort Collins Science Center, Fort Collins, CO, USA

    Christopher Huber

  3. National Park Service, Social Science Program, Fort Collins, CO, USA

    Leslie Richardson

Authors
  1. John Loomis
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  2. Christopher Huber
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  3. Leslie Richardson
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Corresponding author

Correspondence to John Loomis .

Editor information

Editors and Affiliations

  1. Institute for Economic Geography and GIScience, Vienna University of Economics and Business, Vienna, Austria

    Manfred M. Fischer

  2. and Business Administration Department of Spatial Economics, Free University Faculty of Economics, Amsterdam, The Netherlands

    Peter Nijkamp

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Loomis, J., Huber, C., Richardson, L. (2019). Methods of Environmental Valuation. In: Fischer, M., Nijkamp, P. (eds) Handbook of Regional Science. Springer, Berlin, Heidelberg. https://doi.org/10.1007/978-3-642-36203-3_54-1

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  • DOI: https://doi.org/10.1007/978-3-642-36203-3_54-1

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  • Print ISBN: 978-3-642-36203-3

  • Online ISBN: 978-3-642-36203-3

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