The paper focuses on the question of the extent to which individual preference-based values are suitable in guiding environmental policy and damage assessment decisions. Three criteria for “suitableness” are reviewed: conceptual, moral and legal. Their discussion suggests that: (i) the concept of economic value as applied to environmental resources is a meaningful concept based on the notion of trade-off; (ii) the limitations of the moral foundations of cost-benefit analysis do not invalidate its use as a procedure for guiding environmental decision making; (iii) the input of individual preferences into damage assessment is compatible with the basic foundations of tort law; (iv) using individual preference-based methods provides incentives for efficient levels of due care; (v) determining standing is still very contentious for various categories of users as well as for aggregating non-use values. Overall, the discussion suggests that the use of preference-based approaches in both the policy and legal arenas is warranted provided that they are accurately applied, their limitations are openly acknowledged and they assume an information-providing rather than a determinative role.
Kontoleon, A., Macrory, R. and Swanson, T. (2002), "Individual preference-based values and environmental decision making: Should valuation have its day in court?", Swanson, T. (Ed.) An Introduction to the Law and Economics of Environmental Policy: Issues in Institutional Design (Research in Law and Economics, Vol. 20), Emerald Group Publishing Limited, Bingley, pp. 177-214. https://doi.org/10.1016/S0193-5895(02)20009-3
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