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Money, Who Needs It? Natural Resource Damage Assessment

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  • Nicholas E. Flores
  • Jennifer Thacher

Abstract

A new natural resource damage assessment paradigm has been suggested that emphasizes direct analysis of compensatory restoration rather than analysis of compensating variation for damages. This article considers whether money can be avoided in damage assessment. The analysis of compensatory restoration leads to the conclusion that money should be considered when measuring preferences. Failure to consider money leaves trustees unable to judge the adequacy of compensatory restoration. The problem stems from heterogeneity over restoration scale.

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  • Nicholas E. Flores & Jennifer Thacher, 2002. "Money, Who Needs It? Natural Resource Damage Assessment," Contemporary Economic Policy, Western Economic Association International, vol. 20(2), pages 171-178, April.
    • Handle: RePEc:bla:coecpo:v:20:y:2002:i:2:p:171-178
    DOI: 10.1093/cep/20.2.171
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    Cited by:

    1. Gastineau, Pascal & Mossay, Pascal & Taugourdeau, Emmanuelle, 2021. "Ecological compensation: How much and where?," Ecological Economics, Elsevier, vol. 190(C).
    2. George R. Parsons & Ami K. Kang, 2010. "Compensatory Restoration In A Random Utility Model Of Recreation Demand," Contemporary Economic Policy, Western Economic Association International, vol. 28(4), pages 453-463, October.
    3. Gastineau, Pascal & Taugourdeau, Emmanuelle, 2014. "Compensating for environmental damages," Ecological Economics, Elsevier, vol. 97(C), pages 150-161.
    4. Dunford, Richard W. & Ginn, Thomas C. & Desvousges, William H., 2004. "The use of habitat equivalency analysis in natural resource damage assessments," Ecological Economics, Elsevier, vol. 48(1), pages 49-70, January.
    5. Durán, María & Canals, Rosa M. & Sáez, José L. & Ferrer, Vicente & Lera-López, Fernando, 2020. "Disruption of traditional land use regimes causes an economic loss of provisioning services in high-mountain grasslands," Ecosystem Services, Elsevier, vol. 46(C).
    6. Robert J. Johnston & Kevin J. Boyle & Maria L. Loureiro & Ståle Navrud & John Rolfe, 2021. "Guidance to Enhance the Validity and Credibility of Environmental Benefit Transfers," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 79(3), pages 575-624, July.
    7. Jessica Coria & Thomas Sterner, 2011. "Natural Resource Management: Challenges and Policy Options," Annual Review of Resource Economics, Annual Reviews, vol. 3(1), pages 203-230, October.
    8. Amy W. Ando & Madhu Khanna, 2004. "Natural Resource Damage Assessment Methods: Lessons in Simplicity from State Trustees," Contemporary Economic Policy, Western Economic Association International, vol. 22(4), pages 504-519, October.
    9. Pascal Gastineau & Emmanuelle Taugourdeau, 2012. "Which compensation for whom ?," Université Paris1 Panthéon-Sorbonne (Post-Print and Working Papers) halshs-00768884, HAL.
    10. Caplan, Arthur & Grijalva, Therese & Jackson-Smith, Douglas, 2007. "Using choice question formats to determine compensable values: The case of a landfill-siting process," Ecological Economics, Elsevier, vol. 60(4), pages 834-846, February.
    11. Cole, Scott, 2012. "Equity over Efficiency: A Problem of Credibility in Scaling Resource-Based Compensatory?," CERE Working Papers 2012:12, CERE - the Center for Environmental and Resource Economics.
    12. Zafonte, Matthew & Hampton, Steve, 2007. "Exploring welfare implications of resource equivalency analysis in natural resource damage assessments," Ecological Economics, Elsevier, vol. 61(1), pages 134-145, February.
    13. Richard T. Carson, 2011. "Contingent Valuation," Books, Edward Elgar Publishing, number 2489.
    14. Kyriazi, Zacharoula & Lejano, Raul & Maes, Frank & Degraer, Steven, 2015. "Bargaining a net gain compensation agreement between a marine renewable energy developer and a marine protected area manager," Marine Policy, Elsevier, vol. 60(C), pages 40-48.
    15. Roach, Brian & Wade, William W., 2006. "Policy evaluation of natural resource injuries using habitat equivalency analysis," Ecological Economics, Elsevier, vol. 58(2), pages 421-433, June.
    16. Desvousges, William H. & Gard, Nicholas & Michael, Holly J. & Chance, Anne D., 2018. "Habitat and Resource Equivalency Analysis: A Critical Assessment," Ecological Economics, Elsevier, vol. 143(C), pages 74-89.
    17. Jones, Carol Adaire & DiPinto, Lisa, 2018. "The role of ecosystem services in USA natural resource liability litigation," Ecosystem Services, Elsevier, vol. 29(PB), pages 333-351.
    18. Johansson, Per-Olov & Kriström, Bengt, 2012. "On a New Approach to Social Evaluations of Environmental Projects," CERE Working Papers 2012:4, CERE - the Center for Environmental and Resource Economics.
    19. Edward B. Barbier, 2013. "Valuing Ecosystem Services for Coastal Wetland Protection and Restoration: Progress and Challenges," Resources, MDPI, vol. 2(3), pages 1-18, August.
    20. Marc D. Davidson, 2017. "Equity and the Conservation of Global Ecosystem Services," Sustainability, MDPI, vol. 9(3), pages 1-15, February.
    21. Alvarez, Sergio & Larkin, Sherry L. & Whitehead, John C. & Haab, Timothy C., 2012. "Substitution, Damages, and Compensation for Anglers due to Oil Spills:The case of the Deepwater Horizon," 2012 Annual Meeting, August 12-14, 2012, Seattle, Washington 124779, Agricultural and Applied Economics Association.
    22. Kontogianni, Areti & Luck, Gary W. & Skourtos, Michalis, 2010. "Valuing ecosystem services on the basis of service-providing units: A potential approach to address the 'endpoint problem' and improve stated preference methods," Ecological Economics, Elsevier, vol. 69(7), pages 1479-1487, May.
    23. Defrancesco, Edi & Gatto, Paola & Rosato, Paolo, 2014. "A ‘component-based’ approach to discounting for natural resource damage assessment," Ecological Economics, Elsevier, vol. 99(C), pages 1-9.
    24. Douglas J. MacNair & William H. Desvousges, 2007. "The Economics of Fish Consumption Advisories: Insights from Revealed and Stated Preference Data," Land Economics, University of Wisconsin Press, vol. 83(4), pages 600-616.

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