Back of the envelope estimates of environmental damage costs in Mexico

Abstract

For developing countries, budget constraints help set the agenda on mitigating environmental damage, one of the indelible marks of our era. Political considerations often dictate the measures taken. There are no firm analytical formulas to help even environmentally conscious policymakers rank needs and remedies. A developing country such as Mexico - the focus of this paper - cannot afford an in-depth study of every environmental issue. Policymakers need to be provided with rough,"back-of-the envelope"estimates of the economic costs of various environmental problems. This allows them to rank the issues and act. In this paper the author applied existing methods to estimate the costs stemming from different environmental problems in Mexico. Although the examples are from Mexico, the method can be useful in other developing countries as well. The author how creative use of U.S. and other data can help provide simple estimates of the likely costs of soil erosion, air pollution, mining of underground waters, and estimates of the health effects of water and solid waste pollution, lack of sanitation, and the ingestion of food contaminated by polluted irrigation. The assumptions underlying all calculations are conservative. Some environmental damage issues, such as loss of biodiversity, were too complex to permit quantification.Water Conservation,Economic Theory&Research,Health Monitoring&Evaluation,Environmental Economics&Policies,Pollution Management&Control