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Are Preferences for Environmental Quality Sensitive to Financial Funding Schemes? Evidence from a Marine Restoration Programme in the Black Sea

Author

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  • Kyriaki Remoundou

    (Department of International and European Economic Studies, Athens University of Economics and Business)

  • Fikret Adaman

    (Bogaziçi University)

  • Phoebe Koundouri

    (Department of International and European Economic Studies, Athens University of Economics and Business)

  • Paulo A.L.D. Nunes

    (The Mediterranean Science Commission – CIESM, and Department of Agriculture and Natural Resources Economics – TESAF, University of Padova)

Abstract

This paper uses a non-market valuation study to elicit consumers’ preferences for a marine restoration programme in the Black Sea aiming to reduce the level of public health risk from bathing and improve water quality and the overall level of marine biodiversity. In this context, we administer a stated choice experiment in coastal settlements in Ukraine and Turkey and employ two tax revenue reallocation schemes as payment vehicles. One proposes the financing of the marine restoration programme by the reduction of the public budget for renewable energy and the second by the reduction of the public budget on training for civil servants. We examine the stated preferences and the subsequently derived economic value estimates in the two treatments with the aim to investigate whether the trade-off implied by the funding scheme has implications for the valuation outcome. Results reveal that preferences and marginal rates of substitution between the non-price attributes under consideration differ significantly. In the civil servants’ budget reallocation scheme, the reallocation coefficient is positive, implying that ceteris paribus redistribution of public financial resources from this source is utility-enhancing. The magnitude of the results differs in the two considered countries mirroring their heterogeneity in political and cultural dimensions.

Suggested Citation

  • Kyriaki Remoundou & Fikret Adaman & Phoebe Koundouri & Paulo A.L.D. Nunes, 2011. "Are Preferences for Environmental Quality Sensitive to Financial Funding Schemes? Evidence from a Marine Restoration Programme in the Black Sea," Working Papers 2011.38, Fondazione Eni Enrico Mattei.
  • Handle: RePEc:fem:femwpa:2011.38
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    Cited by:

    1. Ahtiainen, Heini & Vanhatalo, Jarno, 2012. "The value of reducing eutrophication in European marine areas — A Bayesian meta-analysis," Ecological Economics, Elsevier, vol. 83(C), pages 1-10.

    More about this item

    Keywords

    Non-Market Valuation; Stated Choice Experiment; Payment Vehicle; Tax Revenues Reallocation; Marine Resources; Black Sea; Marine Biodiversity; Developing Countries;
    All these keywords.

    JEL classification:

    • Q22 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Renewable Resources and Conservation - - - Fishery
    • Q28 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Renewable Resources and Conservation - - - Government Policy

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