Review on Valuation of Environmental Amenity and Pollution

Abstract

The importance of enhancing environmental quality to promote economic development by improving societal well-being and sustainable development on quality of environment have attracted significant attention from researchers in recent years. The focus has been on creating pleasing environments and establishing economic value for such quality improvements in both developed and developing nations. This goes beyond designing the most suitable regulatory instruments; it also involves ensuring the quality of supporting regulatory institutions and their capacity. Although it's evident that human activities significantly impact on health of the environment by emitting pollution, decision-makers find it challenging to grasp the effects of environmental quality and make decisions regarding it due to limited information about the value of environmental conditions (i.e. amenity services and pollution) and their interactions. This paper reviews various studies on the economic valuation of environmental conditions and pollution, the relationship between environmental pollution and amenity services, and the factors influencing the improvement of environmental conditions (including socio-economic variables). The evidence from these studies indicates a causal link between pollution levels in the environment and environmental amenities, and consequently, economic performance.