ABSTRACT
Existence value has become an increasingly important concept as the use of cost-benefit analysis has spread from traditional applications to attempts to place monetary value on, for instance, a rare wetland habitat. It has been given various definitions, but a common element is the value of an object in the natural world apart from any use of it by humans. Existence value was introduced into environmental cost-benefit analysis to deal with a number of problems posed by recent, more ambitious applications of that method. The aim of this chapter is to investigate how far the concept succeeds in tackling these problems, or whether, as critics from outside economics allege, it is entirely flawed and should be abandoned altogether. A fundamental redefinition of existence value is proposed, which aims to address the concerns of these critics while remaining consistent with an essentially utilitarian approach to environmental decision-making. Two independent types of value are defended, existence value and well-being, implying the possibility of incommensurability between values. It is argued that this incommensurability can be overcome, although sometimes only after abandoning monetary measures of value. By distinguishing between commensurables, substitutes and replacements, it is shown when such ‘inkind valuation’ might be necessary. The chapter concludes with a brief discussion of the implications of this theoretical analysis for operational problems such as protest bids.
