FURTHER RESULTS ON WILLINGNESS TO PAY FOR NONMARKET GOODS

Some implications of substitution relationships between private and public goods for measuring the value of changes in nonmarket goods such as environmental quality are explored. If a market good is (Hicks-) neutral to quality for some price vector, the total value of discrete changes in quality, consisting of both use and nonuse value, can be measured from empirical demand coefficients. A plausible motivation for neutrality is developed in the contexts of specifying incomplete demand systems for weak complements to quality and measuring nonuse value when the consumption of weak complements is (held at) zero. Previous results on bounding marginal willingness to pay for nonmarket goods are also strengthened. © 1992.