Broberg, Thomas () (Department of Economics, Umeå University)
Abstract
This paper estimates the public benefit of preserving 126 000 hectares of old-growth forest in the sub-mountainous region of Sweden through contingent valuation. The primary benefit of this in-situ conservation of biodiversity is the forest’s relative diversity and richness, which provides important habitat for threatened species. Thus, benefits arise predominantly from nonuse values. We find that a majority of the Swedish population is unwilling to contribute financially to the preservation project (median WTP equals zero). The estimated mean WTP is SEK 300, implying an aggregate benefit of SEK 9 billion. We estimate two types of valuation functions in order to reject the hypothesis that respondents state random numbers as their WTP. Firstly, a binary logit model indicates that variables related to a respondent’s education level, income level and concern about the environment are positively correlated with the likelihood of supporting the preservation project, while being a male and having an anti-environmental attitude towards public expenditures are negatively correlated. After controlling for whether or not locals are employed in forest-related industries, we find that locals, in general, are more likely to have a positive WTP. Secondly, we estimate a valuation function conditioned on respondents with a positive WTP and find that the size of their contribution is explained by income, general concern about the environment, and the motive underlying their valuation (e.g., use versus nonuse). No differences between locals and non-locals were found.
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Publisher Info
Paper provided by Umeå University, Department of Economics in its series Umeå Economic Studies with number
712.
Length: 22 pages Date of creation: 16 May 2007 Date of revision: Handle: RePEc:hhs:umnees:0712
Contact details of provider: Postal: Department of Economics, Umeå University, S-901 87 Umeå, Sweden Phone: 090 - 786 61 42 Fax: 090 - 77 23 02 Email: Web page: http://www.econ.umu.se/ More information through EDIRC
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References listed on IDEAS Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
Carson, Richard T. & Hanemann, W. Michael, 2006.
"Contingent Valuation,"
Handbook of Environmental Economics,
in: K. G. Mäler & J. R. Vincent (ed.), Handbook of Environmental Economics, edition 1, volume 2, chapter 17, pages 821-936
Elsevier.
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