Environmental economics is dead! Long live environmental economics!

Mark Sagoff

Chapter 2 in A Research Agenda for Environmental Economics, 2020, pp 17-33 from Edward Elgar Publishing

Abstract: It has been reported that the cost of living now exceeds the benefit. Economists measure the cost of living in terms of the market prices of a basket of goods the typical consumer buys. The cost of a good (as in the cost of living) is its market price. When people ask “how much does it cost?†this is what they mean. People often check the Internet or advertisements to find the lowest price at which they can conveniently obtain whatever it is they want. The most people are willing to pay for a good is roughly its competitive market price. People who sell things know this, otherwise they could and would charge much more than they do. The benefit or value that people attain from a good, whatever that might mean, is subjective; it will vary from person to person and time to time because needs, expectations, interests, purposes, information, autonomy, wisdom, and stupidity are extemporaneous, idiosyncratic, mutable, and inconsistent. Nobody can measure happiness, pleasure, satisfaction, or any such mental condition, or compare these states between individuals. The cost of a good in the sense of its market price is observable, especially to bargain hunters. The benefit one obtains from that good is unquantifiable, imponderable, unobservable, and unpredictable; the reason one wants the good, moreover, may have nothing to do with one’s own perceived benefit but with one’s commitment to moral, political, aesthetic, and environmental responsibilities and ideals.

Keywords: Economics and Finance; Environment (search for similar items in EconPapers)
Date: 2020
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