Working Papers in Economics
Environmental Policy when People's Preferences are Inconsistent, Non-Welfaristic, or simply Not Developed
Abstract: This paper discusses how a benevolent policy maker should
act based on some, possibly non-welfaristic,ethical principle in cases
where people's preferences are not perfectly informed,consistent and fully
developed with regard to all goods, including all kinds of environmental
goods, as is normally assumed in mainstream economic theory. When stated or
revealed preferences do not reflect the maximization of individual welfare,
it is argued that welfare,rather than preferences, has intrinsic value.
However, it is also argued that properly designed stated preference methods
may provide useful information about people’s views about alternative
ethical ends, besides human well-being, and that policy makers should take
such views seriously.
Keywords: ethics; environmental policy; environmental valuation; cost-benefit analysis; endogenous preferences; preference construction; irrationality; bounded rationality; cognitive dissonance; anthropocentrism; (follow links to similar papers)
JEL-Codes: A13; D61; Q28; (follow links to similar papers)
20 pages, February 28, 2001
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