For the past 25 years, governmental decision-makers have employed the economic approach of benefit-cost analysis for resource allocation decisions. Environmental Economics describes, in a non-technical, readily understandable way, why the actual practice of benefit-cost analysis in environmental settings is heavily biased against the environment. The book provides environmentalists with the tools necessary to show policy-makers that pursuing many policies with apparent costs greater than benefits are, in fact, welfare enhancing.

Philip E. Graves is professor of economics at the University of Colorado, Boulder. He has been teaching environmental economics for thirty years and is the co-author of The Economics ofEnvironmental Quality (Norton, 1986) and Intermediate Microeconomics (Harcourt, 1988).

Part 1 Part I: Economics BackgroundWhy Economists Like Benefit-Cost AnalysisChapter 2 1 Introductory Matters of Logic and PhilosophyChapter 3 2 Why Economists Like Market Outcomes for Ordinary GoodsChapter 4 3 Benefit-Cost Analysis when Information Is "Perfect": The Role of Time in Environmental Economic DecisionsPart 5 Part II: "Missing Markets": Externalities, Public Goods, and Property RightsChapter 6 4 Externalities as "Missing Markets"Chapter 7 5 Public Goods as "Missing Markets"Chapter 8 6 Property Rights as a Potential Solution to Environmental ProblemsPart 9 Part III: Important Theoretical Problems with Implementing Benefit-Cost AnalysisChapter 10 7 The Well-Known "Demand Revelation" Problem Out of a Given IncomeChapter 11 8 A Less-Well-Known "Supply Revelation" ProblemPart 12 Part IV: Practical Problems with the Implementation of Benefit-Cost AnalysisChapter 13 9 Approaches to Estimating the Costs of Environmental Control PoliciesChapter 14 10 Overview of Approaches to the Valuation of Benefits of Environmental PoliciesChapter 15 11 Voting as a Way to Infer Environmental BenefitsChapter 16 12 Constructed Markets: Stated Preferences and Experiments to Infer Environmental BenefitsChapter 17 13 The Sum of Specific Damages ApproachChapter 18 14 Hedonic Methods of Valuing Environmental AmenitiesChapter 19 15 Travel Cost Method of Valuing Environmental AmenitiesChapter 20 16 Political and Jurisdictional ProblemsPart 21 Epilogue