Tuesday, September 29, 2009

John Loomis on Non-Market Valuation

This article appeared in Choices a few years back.

It is well worth the read.

As someone who does valuation as part of my job, I often encounter opposition to the very idea of placing monetary values on environmental and natural resources. We've seen some of that right here on the blog, and no doubt there are others that share the viewpoints of those who are brave enough to be vocal in expressing their opinion. Loomis does a great job of pointing out the merits and shortcomings of non-market valuation.

4 comments:

Emily Rossi said...

My biggest issue with non-market valuation, is that you simply can NOT know every aspect of a resource we cannot understand everything about a resources role in an ecosystem or how it effects other animals/habitats. It just seems so impossible to really understand a natural resource true value

Dr. Peter Schuhmann said...

Very true Emily. Our science is incomplete. Valuation is difficult.

Does this mean we should not try to get a handle on those aspects of value that we do understand?

Would you rather have an estimate of value (knowing that it will be imperfect) or no estimate at all?

Zach West said...

Like you said in class, the values we come up with are lower bounds to the true value of the resources. I think it is important to stress this when talking about these values because we will never know the true value.

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