ADJUSTING BENEFITS TRANSFER VALUES FOR INFLATION

This paper analyzes assumptions that are implicitly made in updating e stimates of nominal values for environmental goods produced by previou s valuation studies, especially adjustments made through use of the co nsumer price index (CPI). The paper illustrates that the underlying fo rm of preferences for the selected values from a past study may have a significant influence on the updated environmental values. We show wh y care is necessary in updating past welfare or value estimates in the face of changes in the demand and supply for environmental amenities when-using the CPI.