Olaf Merk

Port–City Relationship and the Environment: Literature Survey and Methodological Approach for Project Appraisal in Presence of Environmental Externalities

AbstractIn times of increasing environmental awareness, the port–city relationship has gained new meaning because ports have been seen as the origin of both negative and positive externalities affecting public welfare. While the former are the result of port expansion, the latter are the result of transforming obsolete port areas into recreational facilities. Therefore, to support effective policymaking, this paper considers the following question: What is the scope of economic valuation of these externalities in the context of port-project appraisal? Considering their nonmarket nature, which makes economic valuation more difficult, a contingent valuation method is introduced as an economic tool capable of overcoming this obstacle. Thus, the results of the few studies carried out so far in this particular context are reviewed, and some policy implications are obtained with a view to improving understanding of the changing relationship between ports and cities in a context of growing environmental concern.