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Environmental economic impact assessment in China: Problems and prospects


  • Lindhjem, Henrik
  • Hu, Tao
  • Ma, Zhong
  • Skjelvik, John Magne
  • Song, Guojun
  • Vennemo, Haakon
  • Wu, Jian
  • Zhang, Shiqiu


The use of economic valuation methods to assess environmental impacts of projects and policies has grown considerably in recent years. However, environmental valuation appears to have developed independently of regulations and practice of environmental impact assessment (EIA), despite its potential benefits to the EIA process. Environmental valuation may be useful in judging significance of impacts, determining mitigation level, comparing alternatives and generally enabling a more objective analysis of tradeoffs. In China, laws and regulations require the use of environmental valuation in EIA, but current practice lags far behind. This paper assesses the problems and prospects of introducing environmental valuation into the EIA process in China. We conduct four case studies of environmental economic impact assessment (EEIA), three of which are based on environmental impact statements of construction projects (a power plant, a wastewater treatment plant and a road construction project) and one for a regional pollution problem (wastewater irrigation). The paper demonstrates the potential usefulness of environmental valuation but also discusses several challenges to the introduction and wider use of EEIA, many of which are likely to be of relevance far beyond the Chinese context. The paper closes with suggesting some initial core elements of an EEIA guideline

Suggested Citation

  • Lindhjem, Henrik & Hu, Tao & Ma, Zhong & Skjelvik, John Magne & Song, Guojun & Vennemo, Haakon & Wu, Jian & Zhang, Shiqiu, 2006. "Environmental economic impact assessment in China: Problems and prospects," MPRA Paper 11464, University Library of Munich, Germany.
  • Handle: RePEc:pra:mprapa:11464

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    References listed on IDEAS

    1. Arrow, Kenneth J. & Cropper, Maureen L. & Eads, George C. & Hahn, Robert W. & Lave, Lester B. & Noll, Roger G. & Portney, Paul R. & Russell, Milson & Schmalensee, Richard & Smith, V. Kerry & Stavins, , 1997. "Is there a role for benefit-cost analysis in environmental, health, and safety regulation?," Environment and Development Economics, Cambridge University Press, vol. 2(02), pages 195-221, May.
    2. Richard Carson & Robert Mitchell & Michael Hanemann & Raymond Kopp & Stanley Presser & Paul Ruud, 2003. "Contingent Valuation and Lost Passive Use: Damages from the Exxon Valdez Oil Spill," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 25(3), pages 257-286, July.
    3. Aunan, Kristin & Fang, Jinghua & Vennemo, Haakon & Oye, Kenneth & Seip, Hans M., 2004. "Co-benefits of climate policy--lessons learned from a study in Shanxi, China," Energy Policy, Elsevier, vol. 32(4), pages 567-581, March.
    4. Per Christensen & Lone Kørnøv & Eskild Holm Nielsen, 2005. "EIA as Regulation: Does it Work?," Journal of Environmental Planning and Management, Taylor & Francis Journals, vol. 48(3), pages 393-412.
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    Cited by:

    1. Bin Fang & Chun-Feng Liu & Le- Zou & Yi-Ming Wei, 2012. "The assessment of health impact caused by energy use in urban areas of China: an intake fraction–based analysis," Natural Hazards: Journal of the International Society for the Prevention and Mitigation of Natural Hazards, Springer;International Society for the Prevention and Mitigation of Natural Hazards, vol. 62(1), pages 101-114, May.

    More about this item


    Environmental impact assessment; Environmental valuation; China; Economic analysis;

    JEL classification:

    • D62 - Microeconomics - - Welfare Economics - - - Externalities
    • H41 - Public Economics - - Publicly Provided Goods - - - Public Goods
    • Q51 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Valuation of Environmental Effects


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