Valuing Natural Resource Damages: Economics for CERCLA Lawyers
Editors' Summary: New paths in the development of pollution control law and resource economics intersect in the natural resource damage provisions of the Comprehensive Environmental Response, Compensation, and Liability Act (CERCLA). The law gives the trustees for public access natural resources a new, streamlined cause of action for recovery of damages inflicted by the improper disposal of hazardous substances. At the same time, resource economists have been developing sophisticated methods for estimating the value of such resources to society. That value is not fully recognized by traditional measurement techniques that look to the marketplace for guidance, because these resources—parks, rivers, and wilderness areas—are not traded in the market. Dr. Yang, an economist who has been active in the subject of valuing pollution damages to natural resources, examines the alternatives for valuing those resources under CERCLA. He argues that, where practical, the measure of damage should be the loss in the value of the services that the damaged resources provide for their users. He points out situations in which it is now possible to make reasonable estimates of user value, and situations in which it is not, urging lawyers in the field not to always seek the simplest solution and economists not to always seek the most theoretically correct.