Legal obstacles for contingent valuation methods in environmental litigation

Abstract

Contingent valuation surveys, and other stated preference methods, are sometimes used by economists to solicit opinions from the public regarding the monetary value respondents place on the existence of natural resources, independent of the use of those resources. For example, economists may attempt to use surveys to measure how much the respondent values a particular natural resource, such as a bird species or habitat, even if he or she never uses or sees that resource. For decades, economists, government officials, and others have debated whether such survey methods can accurately measure non-use values in natural resource damage (“NRD”) cases. A central premise of this debate is the oft-repeated notion that contingent valuation and other similar methods are allowed by the NRD regulations and accepted by the courts.2 As we demonstrate below, this premise is inaccurate for several reasons.