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Evaluation of the Utility Function of an Environmental asset: Contingent valuation Method (CVM)

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  • Ali, Bouchrika
  • FakhriI, Issaoui
  • Habib, Jouber

Abstract

The aim of this paper is to introduce the Contingent valuation Method (CVM) as an efficient method allowing to modify the utility level, of an economic agent to following the consumption of environmental goods. In the absence of the market for natural assets, the CVM allows us to create a hypothetical market to evaluate the economic value of those assets by purchase and sale transactions. However, this valuation can be constrained with the quality problem of the physical nature of those environmental assets. The theoretical framework had shown that a change in the utility function and consumer surplus on the one hand, price and profit of the monopoly on the other hand, is be needed to keep the measures of economic efficiency and social equity.

Suggested Citation

  • Ali, Bouchrika & FakhriI, Issaoui & Habib, Jouber, 2014. "Evaluation of the Utility Function of an Environmental asset: Contingent valuation Method (CVM)," MPRA Paper 60421, University Library of Munich, Germany.
    • Handle: RePEc:pra:mprapa:60421
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    References listed on IDEAS

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    More about this item

    Keywords

    CVM; Environmental assets; utility function; willingness to pay (WTP);
    All these keywords.

    JEL classification:

    • Q51 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Valuation of Environmental Effects
    • Q58 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Environmental Economics: Government Policy

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