Environmental valuation of hydro-environmental services of the Tropical Montane Cloud Forest

Abstract

Environmental externalities are just one class of externalities (or external effects). They are not more important than any other type of economic externalities, but it would not be possible to find rational arguments to justify that they are less so. If more complex and therefore better decisions are to be taken, these externalities should be duly quantified and incorporated in the framework of an economic analysis of public or private decisions of society. In that case, they can be accounted for as costs of our decisions. Environmental economics has different environmental valuation methods to include ecosystems and its dynamics into an economic system. The most applied methods are contingent valuation, hedonic prices, and travel cost. These methods may be used as a guide to formulate public policies to protect the environment and have an efficient management. The present research is an analysis for hydro-environmental services (recreational services) of the tropical montane cloud forest (La Granada waterfall) of Coatepec due to the increasing risks caused by human activity. Therefore, the travel cost method will be applied to estimate the economic value associated with the ecosystem. This method applies conventional empirical techniques used by economists to estimate economic values based on market prices. The findings showed different travel costs for every chosen zone and a consumer surplus of $47.10 MXN and an estimated yearly value of $70,645 MXN.