Valuation of Nonmarket Goods

Environmental quality and ecological services, like many other public goods, are not exchanged in markets. However, they clearly provide great value to society. Assessing the monetary benefits of policies designed to improve environmental quality and enhance ecological services therefore requires "nonmarket" valuation methods. Most of these methods are specifically designed to estimate individuals' "willingness to pay" (WTP) for improvements in nonmarket goods and services.

Analytical Methodologies

Stated preference methods
Contingent valuation and conjoint analysis, which use surveys to directly elicit individuals' values
Revealed preference methods
Hedonic and averting behavior, travel cost, cost-of-illness, and productivity evaluations, which infer individuals' values for improvements in environmental quality by observing their behaviors in related markets
Benefit transfer methods
Meta-analysis and preference calibration approaches, which synthesize and adapt valuation data from existing research and apply them to new settings for evaluating specific policies of interest

We are actively involved in the design and application of these methods, as well as in developing tools to support these methods. The purpose of these activities is to advance the understanding of how society benefits from a cleaner, safer, and more productive environment. For example, we have estimated values for

Water quality protection to enhance recreational and other uses
Air quality improvements to protect human health
Watershed and forest ecosystem services supporting agricultural productivity
Preservation of forested landscapes for aesthetic enjoyment
Reduced exposures to reproductive toxins in the environment