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Nonmarket valuation, i.e., valuing environmental goods and services that are not traded in a market, has been increasingly used in a variety of policy and decision-making contexts. This is one (but not the only) way that researchers and practitioners have sought to define and measure the values that individuals assign to environmental goods and services. The idea of putting a dollar value on protecting the environment has been controversial, but often because the economic approach to valuation has not been well-understood. This chapter provides a nontechnical overview of and rationale for the economic approach to valuation, starting from a broad conceptualization of values versus valuation. It summarizes the economic concept of value and its key features. It then discusses the use of economic valuation in decision making, followed by an overview of the steps involved in the valuation process and important issues that arise in implementing that process. Finally, it identifies and briefly summarizes the principal non-market valuation methods used by economists. In doing so, it sets the stage for the more detailed chapters on theory and methods that follow.
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- Valuing Environmental Goods and Services: An Economic Perspective
- Springer Netherlands
- Chapter 1
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