The development and application of economic valuation techniques and their use in environmental policy - A survey
This paper is concerned with the issue of how to introduce monetary valuation into public decision-making. This issue is closely related to introducing rational procedures into public decision-making (Pearce, 2001). All public decision-making involves choice. To economists, rational choice means making the 'best' use of available resources, i.e. choose that option that has the lowest opportunity cost or the lowest value to be sacrificed. Costs and benefits of any project should therefore be weighed as well as compared to cost and benefits of alternative projects. This implies that all impacts of these projects need to be expressed in the same unit to make comparison possible. Money seems to be the most obvious numéraire. We discuss some of the most popular economic valuation techniques and their potential role in public decision-making. Due to the high cost and time that is needed to perform original valuation studies and the limited knowledge of decision-makers with these techniques, we recommend that the Flemish Administration primarily invests in performing high-quality transfer studies.
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- Carson, Richard T. & Hanemann, W. Michael, 2006. "Contingent Valuation," Handbook of Environmental Economics, in: K. G. Mäler & J. R. Vincent (ed.), Handbook of Environmental Economics, edition 1, volume 2, chapter 17, pages 821-936 Elsevier.
- Crooker, John R. & Kling, Catherine L., 1999. "Recreation Demand Models for Environmental Valuation," Staff General Research Papers 5345, Iowa State University, Department of Economics.
- Richard Carson & Theodore Groves, 2007.
"Incentive and informational properties of preference questions,"
Environmental & Resource Economics,
European Association of Environmental and Resource Economists, vol. 37(1), pages 181-210, May.
- Carson, Richard T & Groves, Theodore, 2010. "Incentive and Information Properties of Preference Questions," University of California at San Diego, Economics Working Paper Series qt88d8644g, Department of Economics, UC San Diego.
- Trudy Ann Cameron, 1992. "Combining Contingent Valuation and Travel Cost Data for the Valuation of Nonmarket Goods," Land Economics, University of Wisconsin Press, vol. 68(3), pages 302-317.
- Carson, R.T. & Mitchell, R.C. & Hanemann, W.M. & Kopp, R.J. & Presser, S. & Ruud, P.A., 1992. "A Contingent Valuation Study of Lost Passive Use Values Resulting From the Exxon Valdez Oil Spill," MPRA Paper 6984, University Library of Munich, Germany.
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