Introduction

In March 1990 the United Kingdom government announced that it had approved the construction of the remaining part of a major motorway in the south of England. In reaching their decision the UK government made no attempt to seek the monetary value of the environmental damage done. Finding the component parts of the previous inequality defines a rational economic approach to decision making. But, just as any decision implies a valuation, so any rule about decision making implies a distributional judgement. The reason for devoting time and resources to valuation problems is that they tend to occur in non-market situation. Hedonic pricing can take place using the property market or the labour market. In the property-market case, what is being sought is the influence of environmental quality changes on the prices of houses. Economic valuation techniques are somewhat complex but also largely unknown to policy analysts, decision makers, environmental pressure groups or non-governmental organizations.