Meeting the environmental challenge of port growth: A critical appraisal of the contingent valuation method and an application to Valencia Port, Spain

In order to support effective policy-making, this research is aimed to emphasise the need of measuring the negative impact – or external costs – resulting from port growth. Considering the non-market nature of these external costs, a critical appraisal of the Contingent Valuation method is made paying special attention to the problem of hypothetical bias and the suitability of a willingness to accept (WTA) scenario for damage assessment. Finally, the results of a case study, conducted in Valencia (Spain), are presented with the intention of paving the way for future research in this specific context of port growth and negative externalities. In particular, results indicate that the average compensation required is about €100 per family negatively affected.

► We provide a methodology for valuing changes in environmental quality in port areas. ► We emphasise the need of non-market valuation data. ► We assess critically the adequacy of contingent valuation method for damage assessment. ► We estimate the social costs borne by local residents. ► We apply a willingness to accept approach.