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From tracking hunter values to legal battles: How did the exploration of environmental values begin in the 1950s?
Over the past few decades, advances in environmental economics have led to a deeper exploration of how to determine the value of non-market resources, an exploration that began in the 1950s. This history engages not only the economic theory of environmental protection but also shows how survey techniques can be used to quantify these resources that are difficult to value at market prices.
In environmental protection, although many resources can provide people with utility, they lack direct market value.
In 1947, S.V. Ciriacy-Wantrup first proposed the theory of continuation valuation, trying to evaluate the value of non-market resources through survey techniques. However, practical use of this method began in 1963, when Robert K. Davis conducted surveys to estimate the value of specific wilderness areas by hunters and tourists and found that the results were highly correlated with values estimated by the travel cost method. As academic research advanced, this approach reached its peak in the 1980s, when U.S. government agencies were given the power to litigate damage to environmental resources, marking a new era of exploration of environmental values.
With Oklahoma's 1991 lawsuit against the Department of the Interior, the types of damages the government can recover include non-use value or existence value, which often cannot be assessed through market price mechanisms.
In the process of environmental assessment, existence value is usually measured through continuous valuation surveys. The first quantitative application of this technology was the famous Exxon Valdez oil tanker incident in 1990. This incident provided an opportunity for further application of continuation valuation and prompted authorities to take non-market environmental values into account when awarding compensation amounts.
As doubts about continuation valuations grow, many economists prefer to rely on people's revealed preferences to make price estimates rather than simple survey results. They argue that early surveys were affected by multiple biases, such as strategic behavior, counter-reply and response bias. These challenges prompted the National Oceanic and Atmospheric Administration (NoAA) to convene a panel of senior economists to conduct an in-depth study to provide evidence-based guidance and recommendations on continuation valuations.
The NUA team's recommendations include conducting the survey using face-to-face personal interviews, presenting questions in a poll format on whether specific resource protections are acceptable, and providing detailed resource information.
These recommendations not only improve the accuracy of investigations, but also highlight the significant responsibility investigators need to bear during the process. Through these efforts, continuation valuation as a technique has gradually gained widespread acceptance in legal and economic valuation.
Today, continuation valuation is considered an important real-world valuation technique, especially in certain situations where market valuation cannot be achieved through cash transactions, such as contaminated properties. Many U.S. government agencies have widely used continuation valuation to assess environmental impacts and their economic value when conducting project cost-benefit analyses.
For example, projects such as the assessment of the value of water quality and recreational opportunities downstream of the Grand Canyon Dam, the biodiversity restoration of Mono Lake, and the restoration of salmon spawning grounds in certain rivers have utilized this approach.
In Australia, continuation valuation has also been applied to the assessment of Kakadu National Park, which shows the acceptance and importance of this technology on a global scale. With the increasing emphasis on environmental protection, the assessment made by Continuation Valuation not only affects government decision-making, but also provides necessary support and reference for related legal proceedings.
However, while we pay attention to environmental values, we must reflect on a question: How to balance the contradictions and conflicts between economic development and environmental protection on the road to sustainable development?
