ABSTRACT
Introduction .............................................................................................................. 53 Background ..............................................................................................................54 Study Area ................................................................................................................ 55 Data ........................................................................................................................ 57 Model .......................................................................................................................60 Results ...................................................................................................................... 61 Conclusion ...............................................................................................................64 References ................................................................................................................65
States with active and abandoned mines face large private and public costs to remediate damage to streams and rivers from acid mine drainage (AMD). Calculating the cost of damage to streams and rivers due to AMD is not straightforward and can encompass a wide spectrum of factors, and as we have seen in Chapters 1 through 3 there are different ways to value these factors. There is the dollar loss of recreational activity associated with the streams and rivers, such as sport fishing and river rafting. In addition, other nonmarket values must be considered, although they might be more difficult to quantify. The hedonic pricing method, a revealed preference approach, takes advantage of the fact that sometimes nonmarket values are embodied in the price of other goods or services and therefore can be derived. Based on work developed by Rosen (1974), the implicit value of an attribute, such as water quality, is revealed by the observed price in a market transaction.
