Cost–Benefit Analysis and the Environment

Nick Hanley, University of Glasgow, UK and Clive L. Spash, Vienna University of Economics and Business, Austria

• Part 1: introduction - about this book, a short history of cost-benefit analysis, the structure of a cost-benefit analysis, a preview of major problem areas, Appendix 1.1 example of a CBA; the welfare foundations of CBA - consumer welfare theory, producer welfare theory, conclusions; valuing environmental goods (1) - the contingent valuation method - introduction, theoretical basis, the application of CVM, problem areas in CVM, CVM and non-use values, conclusions, Appendix 3.1 - the contingent ranking method; valuing environmental goods (2) - the hedonic pricing method - introduction, the characteristics theory of value, how the method works, problems with the HP method, conclusions; valuing environmental goods (3) - the travel cost method - introduction, the basic method, problems with the travel cost method, the hedonic travel cost model, conclusions, Appendix 5.1 - travel cost data; valuing environmental goods (4) - production function approaches - introduction, the avoided cost approach, dose-response functions, conclusions; how good are our valuation methods? - introduction, repeatability, validity, what do our value measures measure?, conclusions, Appendix 7.1 - reference operating conditions; discounting and the environment - introduction, the choice of discount rate, intergenerational transfers - equity and ethics, political choice of the social discount rate, conclusions, Appendix 8.1 - risk and the discount rate; irreversibility, ecosystem complexity, institutional capture, and sustainable development - introduction, irreversibility, ecosystem complexity, institutional capture, cost-benefit analysis and sustainable development, conclusions. Part 2: tropospheric ozone damage to agricultural crops - introduction, tropospheric ozone pollution, defining dose, deriving dose-response functions from crops, response functions in economic assessments, regional economic assessments of crop losses, economically important aspects of response functions, conclusions; costs and benefits of controlling nitrate pollution - introduction, controlling nitrate pollution - costing the policy options, the benefits of reducing nitrate pollution, conclusions.

'. . . a rewarding reference and an invaluable teaching text, and one which should capture students' imaginations and interests in environmental economics.'