The valuation of historical sites: a case study of Valdivia,Chile

The economic valuation of cultural heritage is an area of increasing interest and an important research topic in the emerging field of cultural economics. Many services and values associated with cultural heritage are not traded in markets, and their estimation requires methods developed for the valuation of non-market goods, such as those used in environmental economics. This paper applies the contingent valuation method with double dichotomous choice to estimate the value of historical sites in the city of Valdivia, Chile. The valuation exercise was implemented by designing a hypothetical guided walking tour to a cluster of historical sites in the city centre, and surveying tourists visiting the city during the summer of 2004. Parametric and non-parametric statistical methods were used to estimate the survival distribution and the mean and median estimates of the willingness-to-pay (WTP). The study emphasizes the importance of explicitly treating heterogeneous preferences and the sensitivity of the survival distribution to the estimation methods used.     

Comparing the Economic Value of Mountain Biking Estimated Using Revealed and Stated Preference

This research compares non-market valuation techniques by applying a count data travel cost method (TCM) and dichotomous choice contingent valuation method (CVM) to a form of recreation for which it has not been previously applied: mountain biking. Due to mountain biking's increasing popularity these estimates of benefits may be useful in addressing conflicts. One of the most famous mountain biking sites in the US (Moab, Utah) was chosen as the site for which to apply these two models. The benefits that were estimated for trips taken in the spring of 1996 are US$205 and US$235,for the TCM and CVM, respectively.These values are not statistically different using conventional significant levels.     

Exploring Values,Context and Perceptions in Contingent Valuation Studies: The CV Market Stall Technique and Willingness to Pay for Wildlife Conservation

Public preferences for conservation and environmental management may be identified in willingness to pay (WTP) studies. Normally part of a contingent valuation exercise, WTP studies elicit monetary estimates of non-market economic goods. This paper describes a new approach to WTP, the CV Market Stall, a technique that adds a discursive, qualitative dimension to contingent valuation. It is suggested that the CV Market Stall technique is a good method for exploring attitudes and responses to environmental project proposals. The flexible format, with an emphasis upon information provision, discussion and learning would also allow contingent valuation to be extended to much more complex and uncertain environmental issues.     

Tourism and wetland conservation: application of travel cost and willingness to pay an entry fee at Ghodaghodi Lake Complex,Nepal

This study investigated the need and applicability of wetland tourism for resource conservation, using the case of Ghodaghodi Lake Complex, a Ramsar Site in western Nepal. The travel cost method (TCM) was used to determine the recreation potential of the lake complex, while the contingent valuation method (CVM) was used to calculate willingness of visitors to pay an entry fee as a payment vehicle for conservation. The per capita travel cost was found to be NPR 540 (US $7.71), while the mean willingness to pay an entry fee was NPR 34 (US $0.48) per visitor per entry. In addition, factors affecting wetland visitation rates and maximum willingness to pay were identified. Policy implications include the establishment of an entry fee system to offset conservation budgetary constraints, government investment in social benefits equating to at least per capita travel cost identified, and public‐private partnerships, with community participation in tourism promotion and wetland conservation.     

Non-market valuation of off-highway vehicle recreation in Larimer County, Colorado: Implications of trail closures

Few economic studies are available to measure off-highway vehicle recreation benefits foregone when trails must be closed to protect the environment. This paper estimates the non-market benefits associated with off-highway vehicle (OHV) recreation on National Forest lands in Larimer County, Colorado. We use a contingent valuation model (CVM) to estimate benefits to OHV users, which includes dirt bike riders, all terrain vehicle (ATV) riders, and 4-wheel drive (4 × 4) users. Using CVM we find the mean consumer surplus estimates to be $78 per person per day. These results are consistent with the few previous estimates of OHV recreation benefits. This equates to a per trail per summer consumer surplus of at least between $219,467 and $296,876, and a county level surplus per summer to be at least between $796,447 and $1,077,367. These benefits can be compared to environmental costs to obtain a more complete picture of the effects of trail closure, as well as the negative spillovers to non-motorized users.     

Contingent Valuation and Real Economic Commitments: A Private Good Experiment

The ultimate test of the accuracy of contingent valuation methods (CVM), in measuring benefits, is whether subjects will actually pay the amounts that they say they would be willing to pay in a CVM study. An experiment was conducted in which the maximum WTP of potential visitors to enter Warkworth Castle was compared against the acceptance of an entrance ticket at their stated CV price, thus providing a real monetary test of value and behavioural intention. Only 40% of potential visitors at the Castle gate were willing to make a real economic commitment following their CV WTP responses. Whilst the CVM results were found to be comparable with other CVM studies in terms of content and construct validity, they clearly failed a criterion validity test, even when the CVM survey was juxtaposed to the behavioural intention stage. CVM studies need to adopt stringent criteria in deciding the 'truthfulness' and 'legitimacy' of WTP responses, if CVM is to provide accurate and robust estimates of the value of environmental goods.     

Benefit-cost analysis of spruce budworm (Choristoneura fumiferana Clem.) control: incorporating market and non-market values

This study employs a benefit-cost analysis framework to estimate market and non-market benefits and costs of controlling future spruce budworm (Choristoneura fumiferana) outbreaks on Crown forest lands in New Brunswick, Canada. We used: (i) an advanced timber supply model to project potential timber volume saved, timber value benefits, and costs of pest control efforts; and (ii) a recent contingent valuation method analysis that evaluated non-market benefits (i.e., changes in recreation opportunities and existence values) of controlling future spruce budworm outbreaks in the Province. A total of six alternative scenarios were evaluated, including two uncontrolled future budworm outbreak severities (moderate vs. severe) and, for each severity, three control program levels (protecting 10%, 20%, or 40% of the susceptible Crown land forest area). The economic criteria used to evaluate each scenario included benefit-cost ratios and net present values. Under severe outbreak conditions, results indicated that the highest benefit-cost ratio (4.04) occurred when protecting 10% (284,000 ha) of the susceptible area, and the highest net present value ($111 M) occurred when protecting 20% (568,000 ha) of the susceptible area. Under moderate outbreak conditions, the highest benefit-cost ratio (3.24) and net present value ($58.7 M) occurred when protecting 10% (284,000 ha) of the susceptible area. Inclusion of non-market values generally increased the benefit-cost ratios and net present values of the control programs, and in some cases, led to higher levels of control being supported. Results of this study highlight the importance of including non-market values into the decision making process of forest pest management.     

A proposed methodology for measuring incremental environmental benefits from using constructed wetlands to control agricultural non-point-source pollution

A binary response estimation procedure using contingent valuation data is proposed for estimating the incremental environmental benefits associated with the use of constructed wetlands to control agricultural waste-water runoff. The model uses two binary responses per individual while circumventing the non-independence problems associated with follow-up valuation questions. Case study results suggest that the methodology provides a potentially effective means for measuring the non-market benefits of constructed wetlands in addition to water-quality maintenance.1998 Academic Press     

Convergent validity between willingness to pay elicitation methods: an application to Grand Canyon whitewater boaters

We directly compare trip willingness to pay (WTP) values between dichotomous choice contingent valuation (DCCV) and discrete choice experiment (DCE) stated preference surveys of private party Grand Canyon whitewater boaters. The consistency of DCCV and DCE estimates is debated in the literature, and this study contributes to the body of work comparing the methods. Comparisons were made of mean WTP estimates for four hypothetical Colorado River flow-level scenarios. Boaters were found to most highly value mid-range flows, with very low and very high flows eliciting lower WTP estimates across both DCE and DCCV surveys. Mean WTP precision was estimated through simulation. No statistically significant differences were detected between the two methods at three of the four hypothetical flow levels.     

Economic amenity values of wildlife: Six case studies in Pennsylvania

The travel clost method (TCM) and contingent valuation method (CVM) were used to evaluate the economic value of six different ecotourism activities involving observation of wildlife in Pennsylvania. The six activities were: catch-and-release trout fishing; catch-and-release trout fishing with fly-fishing equipment; viewing waterfowl; watching elk; observing migration flights of raptors; and seeing live wildlife in an environmental education setting. TCM results provided significant statistical relationships between level of use and travel costs for the two types of trout fishing activities. CVM provided estimates of consumer surplus for the other four sites. The consumers' surplus value (1988 dollars) of all six activities to participants amounted to a total of more than $1.28 million annually—twice the total out-of-pocket expenditures of approximately $640,000 spent to visit the sites. The economic amenity values of the six activities compare favorably with similarly derived values in other studies for hunting, fishing, hiking, and backpacking in dispersed recreation environments and wilderness areas in western states.     

Considering Conservation Value in Economic Appraisals of Coastal Resources

Measuring the economic value of environmental quality is useful to evaluate policies that affect the use of natural resources. This paper presents the findings of a contingent valuation (CV) survey designed to measure non-use values for the natural coastal environment.This was attempted through evaluating public and scientific values of conservation quality. The results suggest that public perceptions of conservation quality are multidimensional,and that it may be difficult for some individuals to express their preferences for the conservation value of natural resources in monetary terms. Additionally, public and scientific judgments differ concerning some of the physical attributes imparting conservation value. These findings have important implications on efforts to consider environmental quality in land and coastal use decisions.     

An assessment of household willingness to pay for curbside recycling: a comparison of payment card and referendum approaches

Curbside recycling is a tool that communities use to reduce the need for landfill space. This study provides contingent valuation estimates of household willingness to pay (WTP) to continue a curbside recycling program in the face of budget cuts. Comparisons of two forms of the contingent valuation method (CVM) are provided: a single bounded referendum and a payment card. Neither approach emerges as unambiguously superior. Response rates were virtually identical. Both approaches show that support for curbside recycling is highly sensitive to price. Regression results from the payment card provided a more thorough identification of socio-demographic variables associated with WTP than the referendum, but the explanatory power of the two regressions did not differ significantly. The referendum estimates of mean WTP exceed those from the payment card, although the disparities are less than those typically reported in the CVM literature. Local policy makers cited the CVM results as influencing their decisions regarding funding options for the future of the program, and seemed to appreciate the fact that the two approaches provided a fairly narrow range of estimates of WTP. In an era when more of the burden of financing of environmental programs is being shifted to the local level, use of CVM to estimate the WTP of consumers for highly disaggregated goods and services designed to achieve environmental improvement will likely become more relevant to local decision makers who are interested in understanding their constituents' views.     

Economic Value of Instream Flow for Non-Commercial Whitewater Boating Using Recreation Demand and Contingent Valuation Methods

Whitewater river kayaking and river rafting require adequate instream flows that are often adversely affected by upstream water diversions. However, there are very few studies in the USA of the economic value of instream flow to inform environmental managers. This study estimates the economic value of instream flow to non-commercial kayakers derived using a Travel Cost Method recreation demand model and Contingent Valuation Method (CVM), a type of Contingent Behavior Method (CBM). Data were obtained from a visitor survey administered along the Poudre River in Colorado. In the dichotomous choice CVM willingness to pay (WTP) question, visitors were asked if they would still visit the river if the cost of their trip was $Y higher, and the level of $Y was varied across the sample. The CVM yielded an estimate of WTP that was sensitive to flows ranging from $55 per person per day at 300 Cubic Feet per Second (CFS) to a maximum $97 per person per day at flows of 1900 CFS. The recreation demand model estimated a boater’s number of trips per season. We found the number of trips taken was also sensitive to flow, ranging from as little as 1.63 trips at 300 CFS to a maximum number of 14 trips over the season at 1900 CFS. Thus, there is consistency between peak benefits per trip and number of trips, respectively. With an average of about 100 non-commercial boaters per day, the maximum marginal values per acre foot averages about $220. This value exceeds irrigation water values in this area of Colorado.     

Integrating Wetland Management into Sustainable Water Resources Allocation: The Case of Akrotiri Wetland in Cyprus

This paper employs a contingent valuation (CV) study to estimate the value of the economic benefits generated by the Akrotiri wetland in Cyprus. It aims to show how CV estimation results can inform efficient, effective and sustainable wetland conservation policies, as required by the European Union's Water Framework Directive, and to suggest economic instruments that can facilitate the implementation of such policies. The results indicate that the design of these instruments require the capturing of both the use and non-use values generated by wetland services and functions.     

Resident Motivations and Willingness-to-Pay for Urban Biodiversity Conservation in Guangzhou (China)

The monetary assessment of biodiversity measures the welfare damages brought by biodiversity losses and the cost-benefit analysis of conservation projects in a socio-economic context. The contingent valuation method could include motivational factors to strengthen economic analysis of nature conservation. This study analyzed Guangzhou residents’ motivations and willingness-to-pay (WTP) for an urban biodiversity conservation program in the National Baiyun Mountain Scenic Area (BMSA). The peri-urban natural site, offering refuge to some endemic species, is under increasing development pressures for recreational and residential use. A questionnaire survey was conducted in the Guangzhou metropolitan area during June to October 2007. We interviewed face-to-face 720 stratified sampled households to probe residents’ attitudes towards the city’s environmental issues, motivations for urban nature conservation, and WTP for biodiversity conservation. Principal component analysis identified five motivational factors, including environmental benefit, ecological diversity, nature-culture interaction, landscape-recreation function, and intergenerational sustainability, which illustrated the general economic values of urban nature. Logistic regression was applied to predict the probability of people being willing to pay for the urban biodiversity conservation in BMSA. The significant predictors of WTP included household income and the factor nature-culture interaction. The median WTP estimated RMB149/household (about US$19.5/household) per year and an aggregate of RMB291 million (approximately US$19.5/household) per year and an aggregate of RMB291 million (approximately US38.2 million) annually to support the urban conservation project. Including public motivations into contingent valuation presents a promising approach to conduct cost-benefit analysis of public projects in China.     

A contingent valuation of the Mar Lodge Estate,Cairngorm Mountains,Scotland

The contingent valuation method is applied to the economic valuation of a significant environmental resource in the Scottish Highlands. Use and non‐use values are estimated. The results of such studies might be used to assist decision makers assess the case for public intervention to support the provision of environmental non‐market goods.     

Impact of Perceived Importance of Ecosystem Services and Stated Financial Constraints on Willingness to Pay for Riparian Meadow Restoration in Flanders (Belgium)

The strategic importance of ecosystem service valuation as an operational basis for policy decisions on natural restoration has been increasingly recognized in order to align the provision of ecosystem services with the expectation of human society. The contingent valuation method (CVM) is widely used to quantify various ecosystem services. However, two areas of concern arise: (1) whether people value specific functional ecosystem services and overlook some intrinsic aspects of natural restoration, and (2) whether people understand the temporal dimension of ecosystem services and payment schedules given in the contingent scenarios. Using a peri-urban riparian meadow restoration project in Flanders, Belgium as a case, we explored the impacts of residents’ perceived importance of various ecosystem services and stated financial constraints on their willingness-to-pay for the proposed restoration project employing the CVM. The results indicated that people tended to value all the benefits of riparian ecosystem restoration concurrently, although they accorded different importances to each individual category of ecosystem services. A longer payment scheme can help the respondents to think more about the flow of ecosystem services into future generations. A weak temporal embedding effect can be detected, which might be attributed to respondents’ concern about current financial constraints, rather than financial bindings associated with their income and perceived future financial constraints. This demonstrates the multidimensionality of respondents’ financial concerns in CV. This study sheds light on refining future CV studies, especially with regard to public expectation of ecosystem services and the temporal dimension of ecosystem services and payment schedules.     

Valuation of Ecological Resources and Functions

/ Ecological resources are natural resources that provide certain necessary but overlooked system maintenance functions within ecosystems. Environmental economics is in search of an appropriate analysis framework to determine economic values of such resources. This paper presents a framework that estimates and compiles the components of value for a natural ecosystem. The framework begins with the ecological processes involved, which provide functions within the ecosystem and services valued by humans. We discuss the additive or competive nature of these values, and estimate these values through conventional and unconventional techniques. We apply the framework to ecological resources in a shrub-steppe dryland habitat being displaced by development. We first determine which functions and services are mutually exclusive (e.g., farming vs soil stabilization) and which are complementary or products of joint production (e.g., soil stabilization and maintenance of species). We then apply benefit transfer principles with contingent valuation methodology (CVM), travel cost methodology (TCM), and hedonic damage pricing (HDP). Finally, we derive upper-limit values for more difficult-to-value functions through the use of human analogs, which we argue are the most appropriate method of valuation under some circumstances. The highest values of natural shrub-steppe habitat appear to be derived from soil stabilization.KEY WORDS: Natural resource economics; Ecological economics; Ecological resources; Shrub-steppe; Environmental valuation; Cost; Benefit; Value     

A new recoding method for treating protest responses in contingent valuation studies using travel cost data

In this paper, it is proposed one method to recode protest responses applicable to the simple dichotomous format valuation question made to visitors to natural environment in contingent valuation studies. Those respondents that give a protest response but have a travel cost greater than the bid proposed in the valuation question are recoded as an affirmative answer to the proposed payment. The economic justification lies in the minimum willingness to pay for enjoying the environment that travel cost reveals, while valuation question tries to obtain information about respondent maximum willingness to pay. Recoding allows to recover information and to improve estimates, accuracy. It also avoids computational complexity associated with sample selection models used to avoid biases derived from excluding protest responses.     

Valuation of crop genetic resources in Kaski, Nepal: farmers' willingness to pay for rice landraces conservation

Crop genetic resources constitute an important aspect of biodiversity conservation, both because of their direct value to the farmers and due to their indirect global value. This study uses the contingent valuation method to document the economic value of crop genetic resources based on the farmers' willingness to pay for conservation. A total of 107 households in Kaski, Nepal were surveyed in November 2003. Their mean willingness to pay was USD 4.18 for in situ and USD 2.20 for ex situ conservation per annum. Landholding size, household size, education level, socio-economic status, sex of respondent, number of crop landraces grown, and knowledge on biodiversity influenced the willingness to pay for in situ conservation, whereas only landholding size and household size influenced the willingness to pay for ex situ conservation. The respondents were willing to contribute more for in situ than ex situ conservation because of the additional effect of direct use and direct involvement of the farmers in in situ conservation. This study supports the view that economic valuation of crop genetic resources can assist the policy makers in setting conservation priorities.