Constructing Markets: Environmental Economics and the Contingent Valuation Controversy

History of Political Economy, Forthcoming

36 Pages Posted: 4 May 2017

See all articles by H. Spencer Banzhaf

H. Spencer Banzhaf

Georgia State University - Department of Economics; PERC - Property and Environment Research Center; National Bureau of Economic Research (NBER)

Date Written: October 21, 2016

Abstract

As economists took up the task of measuring the "demand" for environmental services not traded in markets, some chose to substituted survey-based methods known as contingent valuation (CV). Doing so, they could not help but find themselves in the uncomfortable position of self-evidently constructing their observations rather than merely observing them. Apparent anomalies between the constructs and the predictions for economic man led to a fierce debate over the merits of contingent valuation - a debate that hinged on the question of whether economic theory was being "applied" or "tested."

Keywords: Contingent Valuation, Stated Preference, History, Environmental Economics

JEL Classification: B2, Q5, D6, C9

Suggested Citation

Banzhaf, H. Spencer, Constructing Markets: Environmental Economics and the Contingent Valuation Controversy (October 21, 2016). History of Political Economy, Forthcoming, Available at SSRN: https://ssrn.com/abstract=2959427 or http://dx.doi.org/10.2139/ssrn.2959427

H. Spencer Banzhaf (Contact Author)

Georgia State University - Department of Economics ( email )

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HOME PAGE: http://hsbanzhaf.gsucreate.org/

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