METHODOLOGY FOR ASSESSING THE ECONOMIC DAMAGE OF ECOLOGICAL HAZARDS IN URBAN AREAS: CONCEPTUAL SHORTCOMINGS OF NON-MARKET VALUATION METHODS AND THE INTEGRAL DAMAGE FUNCTION APPROACH
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https://doi.org/10.5281/zenodo.20593593##semicolon##
non-market valuation, damage function, urban ecological hazards, construction pollution, traffic congestion, industrial waste, contingent valuation, hedonic pricing, Impact Pathway Approach, health cost assessment, environmental economics##article.abstract##
This study provides a critical theoretical-bibliographic analysis of methodological challenges in
assessing the economic damage caused by three specific ecological hazards in urban areas — construction
site pollution, traffic congestion, and industrial waste — through the lens of non-market valuation methods. The
paper examines the conceptual limitations of both stated and revealed preference approaches and proposes
the integral damage function mechanism, grounded in the Impact Pathway Approach, as a theoretically wellfounded
alternative for translating environmental hazards into economic losses and healthcare expenditure
impacts.
A theoretical-bibliographic review was conducted by systematically analyzing peer-reviewed literature from
Scopus- and Web of Science-indexed journals. The study synthesizes foundational and contemporary works
on contingent valuation, hedonic pricing, choice experiments, and damage function approaches within the
framework of urban environmental economics. No primary empirical data or statistical datasets were employed;
the analysis is exclusively conceptual and literature-based.
The analysis reveals that conventional non-market valuation methods have certain systematic conceptual
limitations when applied to urban ecological hazards.: contingent valuation exhibits hypothetical bias, scope
insensitivity, and WTP-WTA disparity; hedonic pricing is compromised by omitted variable bias and spatial
confounding; and choice experiments face cognitive burden and status quo bias. The integral damage function
approach offers a structured causal chain linking emission sources through atmospheric dispersion and doseresponse
relationships to quantifiable health and economic endpoints. A multi-level conceptual framework
diagram is developed, illustrating the transformation pathway from environmental hazards to economic losses
and healthcare costs across macro, meso, and micro analytical levels.
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