Can contingent valuation resolve the “adding-up problem” in environmental impact assessment?

Because most proposals that are to be evaluated by environmental impact assessments could have numerous effects on the environment, it is necessary to find a method to “add up” the benefits and costs to determine whether the net benefits of the proposal are positive. One technique that has been proposed for minimizing the subjectivity inherent in this calculation is contingent valuation, CV. Critical analyses of CV have focused almost exclusively on the difficulties of estimating consumersʹ valuations of products–environmental amenities–that are not normally sold in the market place. In this paper, I look beyond those difficulties to ask whether CV would be a useful technique for EIA practitioners even if the measurement issues could be resolved satisfactorily. I conclude that, in most circumstances, EIA is a sufficiently complex task that the cost of estimating contingent values would be prohibitive.