Page 170 - Environment: The Science Behind the Stories

in no traditional measures of economic worth. Or consider of households in Australia, the researchers found that preser-
Earth’s water cycle (pp. 138–139), by which rain fills our vation was “worth” $435 to $777 million annually to Austral-
reservoirs with drinking water, rivers give us hydropower ia’s population. These numbers exceeded the $102 million in
and flush away our waste, and water evaporates, purifying annual economic benefits expected from mine development,
itself of contaminants and later falling as rain. This natural so the researchers concluded that it was best to preserve the
cycle is vital to our very existence, yet because we do not land undeveloped.
pay for it, markets impose no financial penalties when we Because contingent valuation relies on survey questions
disturb it. and not actual expenditures, critics point out that people may
In Costa Rica and elsewhere, environmental and ecologi- volunteer idealistic (inflated) values, knowing that they will
cal economists have sought ways to assign market values to not actually have to pay the price they name. As a result, many
ecosystem services. One technique, contingent valuation, researchers prefer to use methods that measure people’s prefer-
uses surveys to determine how much people are willing to pay ences as revealed by data on actual behavior. For example,
to protect or restore a resource. Such an approach was used to gauge how much people value parks, researchers may cal-
to assess a proposal to develop a mine near world-famous culate the amount of money, time, or effort people expend to
Kakadu National Park in Australia in the 1990s. To deter- travel to parks. Economists may compare housing prices for
mine how much the land was “worth” economically if pre- similar homes in different settings to infer the dollar value
served undeveloped, researchers interviewed 2000 citizens of landscapes, views, or peace and quiet. They may also
and asked how much they would be willing to pay to pre- assign environmental amenities value by calculating the cost
vent mine development. On average, respondents said their required to restore natural systems that have been damaged,
households would pay $80 to $143 per year to prevent the to replace their functions with technology, or to mitigate harm
predicted impacts. Multiplying these figures by the number from pollution.

FIguRE 6.14 Accounting for nonmarket
values such as those shown here may
help us make better environmental and
economic decisions.

(a) Use value: The worth of something we (b) Existence value: The worth of knowing
use directly that something exists, even if we never
experience it ourselves

(c) Option value: The worth of something (d) Aesthetic value: The worth of CHAPTER 6 • Ethi C s, E C ono mi C s, A nd s ustA in A bl E dE v E lopm E nt
we might use later something’s beauty or emotional appeal

(e) Scientific value: The worth of something (f) Educational value: The worth of (g) Cultural value: The worth of something
for research something for teaching and learning that sustains or helps define a culture 169

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