Norman Meade

Contingent Valuation: Controversies and Evidence

Contingent valuation (CV) has become one of the most widely usednon-market valuation techniques. CVs prominence is due to itsflexibility and ability to estimate total value, includingpassive use value. Its use and the inclusion of passive use valuein benefit-cost analyses and environmental litigation are thesubject of a contentious debate. This paper discusses key areasof the debate over CV and the validity of passive use value. Weconclude that many of the alleged problems with CV can beresolved by careful study design and implementation. We furtherconclude that claims that empirical CV findings are theoreticallyinconsistent are not generally supported by the literature. Thedebate over CV, however, has clarified several key issues relatedto nonmarket valuation and can provide useful guidance both to CVpractitioners and the users of CV results.

Putting a value on injuries to natural assets: The BP oil spill

Stated-preference research supports

Contingent valuation: Flawed logic? Response

17.2B in protections When large-scale accidents cause catastrophic damage to natural or cultural resources, government and industry are faced with the challenge of assessing the extent of damages and the magnitude of restoration that is warranted. Although market transactions for privately owned assets provide information about how valuable they are to the people involved, the public services of natural assets are not exchanged on markets; thus, efforts to learn about peoples values involve either untestable assumptions about how other things people do relate to these services or empirical estimates based on responses to stated-preference surveys. Valuation based on such surveys has been criticized because the respondents are not engaged in real transactions. Our research in the aftermath of the 2010 BP Deepwater Horizon oil spill addresses these criticisms using the first, nationally representative, stated-preference survey that tests whether responses are consistent with rational economic choices that are expected with real transactions. Our results confirm that the survey findings are consistent with economic decisions and would support investing at least

Total economic value for protecting and restoring Hawaiian coral reef ecosystems final report

17.2 billion to prevent such injuries in the future to the Gulf of Mexicos natural resources.

Total Economic Value for Protecting and Restoring Hawaiian Coral Reef Ecosystems

Baron questions the methods and conclusions of our contingent valuation study, which assessed the economic value to the American public of the 2010 oil spill in the Gulf of Mexico. In the study, survey respondents were each randomly assigned to be told about either (i) a set of effects of the oil