Non-Market Valuation
Non-Market Valuation refers to methods used to estimate the value of goods and services that are not bought and sold in traditional markets. This includes things like clean air, beauty of nature, or public parks. Because these items don’t have a price tag, economists use techniques like surveys or studies to figure out how much people are willing to pay to enjoy or preserve them. This helps policymakers make informed decisions about conservation and resource management by understanding the true value of these benefits to society.
Additional Insights
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Non-market valuation refers to methods used to estimate the economic value of resources and services that are not bought and sold in traditional markets, such as clean air, biodiversity, or recreational spaces. Since there are no prices for these, techniques like surveys, contingent valuation, and hedonic pricing are utilized to gauge how much people are willing to pay to preserve or enhance these resources. This helps inform policymakers about the benefits of environmental conservation and the true value of public goods, ensuring that decisions consider both market and non-market impacts.