This paper reports a Contingent Valuation application to estimate the non-market costs and benefits of hydro scheme developments in an Icelandic wilderness area. A deliberative group -based approach, called Market Stall, is compared to a control group consisting of conventional in-person interviews, in order to investigate flaws of Contingent Valuation, such as poor validity and protest responses. Perceived property rights suggested the use of willingness-to-accept in compensation for wilderness loss and willingness-to-pay for hydro scheme benefits. The study is novel as (...) it applies participant behaviour observation to gain insights into the shortcomings of conventional data collection modes. Main drawbacks with in-person interviews were found to be low motivation, standardised information and time pressure which hindered individuals from carefully considering their preferences. Market Stall performed better in the study: welfare estimates were more easily explained by socio-economic variables, the non-response rate was lower, and respondents were more engaged. Our research findings also suggest that participant behaviour can be used to supplement conventional validity tests. (shrink)

This article examines Sagoff's criticisms of 'Four Dogmas of Environmental Economies' and argues that none of them are fatal. Many of the criticisms appear to rest on general misunderstandings about welfare economics. One misunderstanding is that transaction costs are theoretically indistinguishable from regular production costs. The theoretical distinction is that transaction costs vary under alternative policies and institutions whereas production costs are fixed by tastes, technology and endowments. Another misunderstanding is that market failure concerns only Pareto efficiency. Market failure also (...) concerns social efficiency with respect to the 'social welfare function', a device for making explicit ethical judgments about the interpersonal distribution of welfare. A third misunderstanding is that the 'rationality assumption' drives economic theory. In fact, the explanatory power of economic models comes mainly from explicit assumptions about the constraints facing economic agents. A fourth misunderstanding is that welfare economics is used as a mechanism for making legal and political decisions. Rather, welfare economics is used as a method for informing legal and political decisions by evaluating their outcomes on the basis of individual welfare. Used properly, it can improve the democratic process by bringing hidden costs and difficult issues to the attention of both policy-makers and the wider public. (shrink)

A rational process for assessment of environmental policy options should be based on an appreciation of how humans value nature. Increased understanding of values will also contribute to the development of appropriate ways for us to relate to and manage natural areas. Over the past two decades, environmental philosophers have examined the notion that there is an intrinsic value in nature. Economists have attempted to define and measure the market and nonmarket economic values associated with decisions concerning natural areas. Psychologists (...) have tried to assess the extent to which people believe in an intrinsic value in nature, and have also begun to work with economists to improve nonmarket valuation techniques. I briefly review the contributions made to our understanding of natural area value by environmental philosophy, psychology and economics, and develop a model that integrates insights from these disciplines. Components in the model include cognitions, held values, assigned values and various modes of value expression. I make recommendations for future validation, development and use of the model. (shrink)

The trend in environmental management toward more adaptive, community-based, and holistic approaches will require new approaches to environmental valuation. In this paper, we offer a new valuation approach, one that embodies the core principles of adaptive management, which is experimental, multi-scalar, and place-based. In addition, we use hierarchy theory to incorporate spatial and temporal variability of natural systems into a multi-scalar management model. Our approach results in the consideration of multiple values within community-based ecosystem management, rather than an attempt to (...) maximise a single variable such as economic efficiency. We then offer two heuristics – one procedural and one evaluative – to guide a community toward shared goals, and to develop indicators to measure progress toward these goals. We illustrate our approach by application to environmental and developmental decisions in the Southern Appalachians. (shrink)

This paper recognises the many contributions to work on environmental values while arguing that some reconsideration of elicitation practices is warranted. It argues that speaking and thinking about certain environmental values, particularly ethical expressions, are ill-matched with the affectively neutral, direct question-answer formats standard to willingness-to-pay and survey methods. Several indirect, narrated, and affectively resonant elicitation tasks were used to provide study participants with new opportunities to express their values. Coded results demonstrate that morally resonant, image- based, and narrative-style elicitation (...) tasks help respondents articulate a broader range of noncost and nonutilitarian environmental values. However, it was found that elicitations of this kind are most useful when presented in a affectively subtle and noncontroversial form. Several suggestions for synthesising these methods with more structured forms are offered. (shrink)

Maintaining plural values is important when there is no conclusive principle by which the relative priority of normative positions can be determined. Value-articulating institutions predicated upon such principles have a low pluralistic potential. In response to the failures of stated-preference approaches to economic valuation, new perspectives have been developed to capture plural values. Three broad approaches are identified. The first, functional diversifi-cation, seeks to encompass the multiple qualities of the object of valuation, whereas positional modification enforces a particular mode of (...) thinking on the subject. Both entail a prior judgement of values and benefit from a reduction in the range of values. Eventually, therefore, both approaches collapse pluralism to a problem that can be tackled. The third approach, structural reconstruction, has greater pluralistic potential, recognising that the more diverse and uncertain the object of valuation, the more compelling it is. (shrink)