Methodological issues in valuing the benefits of environmentally sensitive areas

This paper replies to a number of concerns raised by Hodge and McNally (1998) regarding the monetary valuation of Environmentally Sensitive Area schemes using the contingent valuation method. In addition to clarifying a number of concerns regarding the methodology of the original case study, this paper reports a more formally structured theoretical methodology for evaluating Environmentally Sensitive Areas and raises a number of issues regarding the nature of policy evaluations in the public sector.