Contingent Valuation Method for General Practitioners: A Cookbook Approach

Contingent Valuation Method (CVM) has become an increasingly attractive method for thevaluation of non-market goods and services, such as preservation of bio-diversity of habitats,and for assessing the demand for sanitation services and improvements in water supply. Thetechnique has shortcomings some of which are inherent, particularly in situations where mostof the benefits of the good being valued does not derive from its use. Other shortcomingsarise mainly in the application of the technique in developing countries where, for example,because of inadequate information on households a sample used for the CVM may not betruly representative. Once these shortcomings are noted and steps are taken to minimise theirimpact, CVM surveys provide valuable information of use to policy makers. This paperprovides readers with little or no training in non-market valuation techniques with a practicalguide to such technique