The aggregation of environmental benefit values: A spatially sensitive valuation function approach

This paper reviews the literature regarding the aggregation of benefit value estimates for environmental resources. The paper is prompted by the UK Environment Agency 'political jurisdiction' approach to aggregation of values for a single site as used in their study for the River Kennet tribunal. Two case studies are presented through which an alternative approach to aggregation is developed that applies the spatial analytic capabilities of a geographical information system to combine geo-referenced physical, census and survey data to estimate a spatially sensitive valuation function. These functions highlight the fact that resource values are expected to decline with increasing distance of households from the resource. The case studies show that the reliance upon political jurisdictions and the use of sample mean values within the aggregation process are liable to lead to significant errors in resultant values. The paper concludes with some limitations of the approach used as well as recommendations for future work in this area.