A non-market product is a Product that is not bought or sold directly through market transactions. Because it does not participate in conventional market exchanges, a non-market product does not have an observable monetary value derived from direct sale prices.
According to the broader definition of product in LCA, a product is defined as an activity output with positive market or non-market value (utility). This inclusive definition recognises that value extends beyond what can be observed through market prices alone. Non-market products possess utility and contribute to human wellbeing, but this value is not captured through conventional commercial transactions.
Examples of non-market products include household childcare, ecosystem services such as clean air and water filtration, biodiversity benefits, and internal by-products that are later transformed into products with market value within an organisation. These products provide real benefits to individuals or society, but their value must be estimated through alternative valuation methods rather than observed market prices.
In the context of Life Cycle Sustainability Assessment and cost-benefit analysis, non-market products present particular challenges for valuation. Whilst market products have readily observable prices that reflect their exchange value, non-market products require specialised valuation techniques. Methods such as contingent valuation, stated preference approaches, and willingness-to-pay assessments are employed to estimate the monetary value of non-market products when monetary valuation is necessary for comprehensive sustainability assessment.
Understanding non-market products is essential for capturing the full scope of benefits and impacts in LCA studies, particularly when assessing external benefits that create gains in human wellbeing without being reflected in conventional economic accounting.
