Valuing the environment for decisionmaking

Making thoughtful decisions about environmental challenges that involve wide-ranging and potentially irreversible consequences is of profound importance for current and future human wellbeing. Good environmental management and policy decisionmaking necessitates systematic evaluation and consideration of the effects of management and policy on the affected public. Two methods used in such multidimensional, multiperson decisionmaking contexts are economic benefit/cost calculations and multicriteria decision analysis (MCDA). Each of these methods transforms a complex multidimensional problem involving multiple people into a single dimension that can be used to rank alternatives. To be operational, benefit/cost and MCDA methods require information on relative values for different dimensions of value affected by environmental management or policy. Some environmental changes directly affect marketed goods and services, and the value of these effects can be evaluated by assessing the net change in economic surplus in the affected markets.