The Quantification of Non-Action Costs as an Incentive to Address Water Pollution Problems

Abstract

Diffuse pollution is one type of pollution generated by agricultural, livestock, and urban runoff that is responsible for surface and groundwater pollution. As a result, the exposed population develops different diseases that affect their short, medium, and long-term quality of life. Researchers need to be able to assess the loss of quality of life in monetary terms to include this social impact in decision-making processes. Specifically, if no measure is implemented to correct the situation, these costs can be considered as the non-action costs of the social impact of water pollution. This study assesses the importance of measuring healthcare costs as a proxy for non-action costs for the economic assessment of water pollution consequences. Thanks to this analysis, it is possible to identify the health costs produced by the current environmental situation, making it possible to obtain an economic baseline scenario prior to the implementation of any project or measure. This approach is a novelty in the literature since, to date, healthcare costs have not been related to non-action costs. Including these costs in economic feasibility studies allow us to assess in detail both the social impact of pollution and the social benefits of develop water-quality improvement projects.