Comparative analysis of non-market valuation techniques for the Eduardo Avaroa Reserve, Bolivia

Abstract

Ecological tourism has held up as a potentially important development alternative in relatively undeveloped regions and countries. However, tourism is a highly vulnerable activity where tourists display voluntary and discretionary behavior. While tourism can serve as an income-generating activity for the region, uncontrolled tourism that is developed without consideration of the environmental impact can adversely affect the natural areas. Determining what to charge tourists to view a natural area is difficult since demand elasticities are not readily available from observable transactions. In order to better gauge the value tourists place on the reserve and their sensitivity to changes in the costs of visiting Eduardo Avaroa, non-market valuation provides several valuable tools. Here, we test the convergent validity between two popular non-market valuation alternatives: the contingent valuation method and the contingent behavior method. Tourists to the Eduardo Avaroa Reserve in Bolivia were asked their willingness to pay (in visitor-days or in dollars) due to an improvement in tourism services at the reserve. Our models show that the traditionally important variables predict willingness to pay for improved services for the contingent behavior, contingent valuation and the pooled model. However, we find statistically and empirically meaningful distinctions in the estimates derived from the two methods. Comparisons of the implications of adopting the entrance fee recommendations from the two non-market valuation techniques are made based on the revenues predicted to accrue to Eduardo Avaroa Reserve if park management techniques were improved. This research highlights the challenges in using non-market valuation techniques for policy formation, particularly in a developing country setting.