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Most environmental goods and services, 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- is not revealed in market prices. The only option for assigning monetary values to them is to rely on non-market valuation methods.
Without these value estimates, these resources may be implicitly undervalued and decisions regarding their use and stewardship may not accurately reflect their true value to society.
Source: GreenFacts, based on
Ecosystem Valuation
A fundamental distinction in economics is between market and non-market goods and services. Goods and Services in a free market economy are sold for prices that reflect a balance between the costs of production and what people are willing to pay.
Some environmental goods and services, such as fish and seaweed, are traded in markets, thus their value can be directly observed. Conversely, a non-market good or service is something that is not bought or sold directly. Therefore, a non-market good does not have an observable monetary value. Examples of this include beach visits, wildlife viewing, or snorkeling at a coral reef.
Source: GreenFacts
Español: Servicios no mercantiles de los ecosistemas
Français: Valeur non marchande
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