Have Recent Studies Rendered Environmental Externality Valuation Irrelevant?

Evaluation of negative environmental impacts of electricity generation: Neoclassical and institutional approaches

“…Ottinger (1997) criticized that it renders the values adopted irrelevant to any policy formulation or resource selection decisions. This disparity derives from their methodological differences.…”

“…Table 1 shows the early studies, most of which are on the basis of top-down approach. These studies have already been reviewed by the literature (i.e., Lee, 1997;Ottinger, 1997;Stirling, 1997aStirling, , 1998Sundqvist and So¨derholm, 2002;So¨derholm and Sundqvist, 2003). Thus, in order to avoid duplication and to more fully evaluate the recent studies, the general methodological and theoretical writings of the early studies are not reviewed.…”

“…Second, there are entire classes of environmental effects about which the analyst is ignorant, and which are therefore excluded from analysis. Ottinger (1997) argues that the very small values resulting from ignorance raise a serious question. Damages not valued, for whatever reason, are effectively valued at zero.…”