It is too bad that as we begin looking at benefit assessment in my environmental and regulatory classes that we have this gusher gushing up the Gulf Coast providing us with such a vivid real-time example. So how do we go about valuing environmental benefits? Well, here’s a recycled piece from Slate.com, here’s Trudy Cameron at at The New Palgrave Dictionary of Economics, and here’s the guys over at www.env-econ.net with some estimates of lost fishing value. That should get you started.
As you know (or should know), there are a couple of ways of doing this. One is through market-type valuations, and another is through “contingent” valuation methods. We economists typically prefer watching what people do rather what they say they would do in some hypothetical situation, but sometimes we get what we get.
And for those of you who think this is no big deal, it would appear that you are wrong.