valuation of public goods

Valuation of public goods involves estimating how much people value or benefit from them, even if they don't pay directly. Since these goods, like clean air or national defense, are available to everyone regardless of individual payments, traditional market prices don't work. Instead, economists use methods like surveys or observing behaviors to gauge how much individuals value the good, helping policymakers decide whether the benefits justify the costs of providing or protecting these shared resources. This process ensures that public resources are allocated efficiently to maximize overall societal well-being.