Direct market prices

The most simple and straightforward way of finding out the value of environmental
resources is to look at their market prices what they cost to buy or are worth to sell. Market
prices reflect what people are willing to pay for them the value that they place on them. All the
costs and benefits associated with a proposed or alternative use option can be determined by the
prices that are paid, assuming there are no market distortions.
However, it is often difficult to apply to environmental resources since many
environmental goods have no market at all (e.g. those used for subsistence purposes). Further, it
is not always true that market prices reflect economic scarcity and, therefore, are economic
efficient prices. Market prices can be distorted because of taxes, subsidies, monopolies, exchange
rates or other interventions so they do not reflect the true value of product (see Chapter 3).