Non-Market Goods
Most environmental goods, such as clean air
and water, and healthy fish and wildlife populations, are not traded in markets. Their economic value -
how much people would be willing to pay for them in dollars is not revealed in market prices. The only option
for assigning dollar values to them is to rely on non-market valuation methods.
Non-Rival Goods
One person's consumption of most goods
(apples or housing) reduces the amount available for everyone else. Environmental goods are different. Clean
water and air, beautiful views, and to some extent outdoor recreation, can be enjoyed by everyone in
the same way as radio and television. The economic value of non-rival or public goods is the sum of all people's willingness to
pay.
Non-exclusive Goods
People cannot be excluded from enjoying most
environmental goods and the cost of trying to exclude them is prohibitive. Other than increases in onsite
hunting and fishing opportunities, which may be a source of economic benefit to farmers, the
environmental benefits of most conservation practices are non-exclusive. The free rider problem makes it impractical
for farmers to recoup the cost of on-farm conservation investments from those who benefit from
off-farm environmental improvements.
Inseparable Goods
Conservation practices at a given site
contribute in many roundabout ways to environmental goods and result in environmental and economic benefits that
accrue over great distances in time and space. It may be impossible to separate the economic benefits
that result from one conservation practice undertaken at one site from another undertaken at another site.
Worse, it may be impossible to separate the aggregate benefits of those practices from those of other
environmental investments.