Contingent Valuation: Not an Appropriate Valuation Tool

摘要

The proposition has been put forth that the contingent valuation (CV) method may be used to quantify diminution in real property values due to various detrimental conditions. The blue-ribbon panel report of the National Oceanic and Atmospheric Administration has been frequently cited as primary support for this proposition. This article presents the words of that report to show the reasons why the use of contingent valuation is inappropriate for quantifying the effect of detrimental conditions on property value. Additional information is provided concerning hypothetical market surveys in general and the guidelines for evaluation of the reliability and accuracy of the results of such surveys.