Introduction - the challenge of valuing biodiversity Society needs to make difficult decisions regarding its use of biological resources, for example in terms of habitat conservation, or changing how we manage farmland through agri-environmental policy (Hanley and Shogren 2002). Environmental valuation techniques can provide useful evidence to support such policies by quantifying the economic value associated with the protection of biological resources. Pearce (2001, p. 29) argues that the measurement of the economic value of biodiversity is a fundamental step towards its conservation since ‘the pressures to reduce biodiversity are so large that the chances that we will introduce incentives [for the protection of biodiversity] without demonstrating the economic value of biodiversity are much less than if we do engage in valuation’. Assigning monetary values to biodiversity is thus important since it allows the benefits associated with biodiversity to be directly compared with the economic value of alternative resource use options (Nunes and van den Bergh 2001). OECD (2001) also recognises the importance of measuring the economic value of biodiversity and identifies a wide range of uses for such values, including demonstrating the value of biodiversity, in targeting biodiversity protection within scarce budgets, and in determining damages for loss of biodiversity in liability regimes. More generally, the role of environmental valuation methodologies in policy formulation is increasingly being recognised by policy-makers.