Environmental Economics Seminar: The Definition and Choice of Environmental Commodities for Non-market Valuation
Date(s): August 26, 2009, 1:30 pm
Location: Room 5126, EPA West, 1301 Constitution Ave., NW, Washington, DC
Presenter: Jim Boyd & Alan Krupnick, (Resources for the Future)
Description: Economic analyses of nature must somehow define the “environmental commodities” to which values are attached. This paper articulates a set of principles to guide the choice and interpretation of non-market commodities. The presenters will describe how complex natural systems can be decomposed consistent with what can be called “ecological production theory.” Ecological production theory – like conventional production theory – distinguishes between biophysical inputs, process, and outputs. They will argue that a systems approach to the decomposition and presentation of natural commodities can inform and possibly improve the validity of non-market environmental valuation studies. They will raise concerns about the interpretation, usefulness, and accuracy of benefit estimates derived without reference to ecological production theory. They also will discuss ongoing work with EPA's Office of Research and Development relating to the measurement of ecological endpoints and policy-relevant ecological production functions, and ways in which their hypotheses can be tested.