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The Valuation Problem

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Natural Resource Economics

Part of the book series: Recent Economic Thought Series ((RETH,volume 7))

Abstract

Economists are often asked to determine the values of commodities as part of cost-benefit analyses. Many goods and services are traded in organized markets, and it is reasonably straightforward to derive values for these commodities. Consumer surplus is given by the area under the inverse Marshallian demand curve and above the good’s market-clearing price. This so-called “welfare triangle” is an estimate of what consumers would be willing to pay for incremental units of the good (X i ) up to the actual level (X* i ) minus the amount they actually pay, which in turn equals X* i multiplied by the market price, P* xi .

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  1. Glen D. Anderson
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  2. Richard C. Bishop
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  1. University of Wisconsin, USA

    Daniel W. Bromley

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© 1986 Kluwer-Nijhoff Publishing, Boston

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Anderson, G.D., Bishop, R.C. (1986). The Valuation Problem. In: Bromley, D.W. (eds) Natural Resource Economics. Recent Economic Thought Series, vol 7. Springer, Dordrecht. https://doi.org/10.1007/978-94-011-7426-8_3

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  • DOI: https://doi.org/10.1007/978-94-011-7426-8_3

  • Publisher Name: Springer, Dordrecht

  • Print ISBN: 978-94-011-7428-2

  • Online ISBN: 978-94-011-7426-8

  • eBook Packages: Springer Book Archive

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