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Centre for Development, Environment and Policy (CeDEP)

Environmental Valuation: Theory, Techniques and Application

Course Code:
Unit value:
This module develops the theory and techniques of the valuation of non-market goods and services. The module focuses on the techniques and methods for putting monetary values on the environment and shows how these can be incorporated in economic decision making at both the macro and project level. Neo-classical economics can be used as a tool to assign monetary values to environmental goods and services and these values can then be incorporated into decision making at the project, sectoral and national levels. Although the methods and techniques which this module introduces represent the mainstream approach to environmental economic decision making, there are criticisms of such an approach, and the module also addresses these concerns and outlines alternative approaches to analysing economy-environment linkages.

Objectives and learning outcomes of the course

Students will be able to:

  • understand and critically assess the neo-classical theory of environmental valuation
  • explain and critically evaluate a range of environmental valuation methods and techniques
  • give examples to illustrate the application of valuation techniques in practice
  • demonstrate how environmental values can be incorporated in economic decision-making at the national and project level.

Scope and syllabus

Unit 1: The Economy, Environment and Valuation
Unit 2: Economic Theory and Environmental Valuation
Unit 3: Non-Demand Curve Methods
Unit 4: Travel Cost Method
Unit 5: Hedonic Pricing Methods
Unit 6: Contingent Valuation
Unit 7: Choice Experiments
Unit 8: Benefit Transfer
Unit 9: Cost–Benefit Analysis
Unit 10: Criticisms of Stated Preference Methods and Alternatives