Abstract
Environmental accounting is potentially a very valuable tool in planning, public resource management, pollution control and policy analysis. Its main limitations are as follows:
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1.
Valuation techniques for environmental goods and services are imperfect and shadow prices are only partial valuations. This applies to both deductive and interrogative techniques.
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2.
Social values for environmental goods and services are uncertain and change very rapidly.
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3.
Non-economic values are also important in political processes.
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4.
Aggregation of individual preferences may not yield a meaningful net social preference.
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5.
Economic values are marginal and incremental, not absolute and total
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6.
Reliable industry data are not readily available.
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7.
Assumptions underlying standard economic theory and analytical models are often not met.
Existing data on the costs and benefits of environmental protection measures to industry and to national economies are reviewed, as are misconceptions relating to: market prices and utility; hypothetical valuation and social values; willingness to pay or to accept compensation; private property rights in environmental goods and services; and discount rates in economic analysis.
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Buckley, R. (1991). Environmental Accounting: Techniques and Limitations. In: Perspectives in Environmental Management. Springer, Berlin, Heidelberg. https://doi.org/10.1007/978-3-642-76502-5_3
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DOI: https://doi.org/10.1007/978-3-642-76502-5_3
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