Open AccessNonmarket Economic Valuation for Irrigation Water Policy Decisions: Some Methodological Issues
Author(s) -
Young Robert A.
Publication year - 2005
Publication title -
journal of contemporary water research and education
Language(s) - English
Resource type - Journals
eISSN - 1936-704X
pISSN - 1936-7031
DOI - 10.1111/j.1936-704x.2005.mp131001004.x
Subject(s) - nonmarket forces , valuation (finance) , miller , citation , agriculture , economics , applied economics , agricultural economics , sociology , political science , law , geography , positive economics , finance , archaeology , ecology , factor market , biology , market economy
onmarket economic valuation can be defined as the analysis of actual and hypothetical human behavior to derive estimates of the economic value (called accounting or shadow prices) of goods and services in situations where market prices are absent or distorted. Due to the prevailing lack of markets for water-related goods and services, accounting prices are an essential component of economic assessment of public water allocation and other policy choices. Both the theory and methods developed by economists for nonmarket valuation have been greatly expanded and improved over the last several decades, and refinement in the field continues. The progress has occurred with the usual scholarly practice of confronting conceptual models with empirical evidence, and revising the former when it conflicts with the latter. Most of the effort towards a nonmarket economic valuation has focused on households' valuation of environmental public good uses of water, but producers' uses of water is another important field. For this interdisciplinary audience, my intent here is to discuss some issues regarding nonmarket economic valuation in the context of one of my major professional interests: irrigation water policies (see Young 2005).