Chapter 12 Welfare Theory and Valuation

摘要: Abstract Public policies that lead to a reduction in the emissions of air and water pollutants or protection sensitive ecosystems presumably increase well-being many members society. Applied welfare economists are accustomed measuring effects invoke price changes. If it is granted public good attributes most dimensions environmental quality preclude development well functioning markets for these service flows, how monetary values changes be measured? The past twenty thirty years have seen rapid economic theory techniques demands nonmarketed goods, this chapter we attempt sketch out major results. We review basic concept derive measures change both prices market goods quantities qualities nonmarket goods. then describe principal estimating benefits improvements when either directly affect individuals' indirectly individuals through constraints they face. Perhaps class measurement methods based on observation may cause alter purchases services complements substitutes their preference orderings. These revealed primary focus chapter. A second approach obtaining estimates costs changes, stated methods, addressed detail later chapters. Our treatment places special emphasis connection between underlying practical empirical models.