THEORIES OF FAILURE, FAILURE OF THEORIES
AND NON-MARKET VALUATION: A SURVEY
Non-market valuation of environmental benefits and costs plays a crucial role in environmental decision-making both at the micro and at the macro-levels. This paper basically reviews three theoretical developments embedded in economics, which can provide frameworks to value non-market benefits and costs of changes in environment. The major conclusion of this paper is that non-market valuation should be treated as derived demand from any of these theoretical frameworks so that appropriate environmental policy measures can be initiated in the relevant areas.