Evaluation of the environmental impacts of extreme floods in the Evros River basin using Contingent Valuation Method

Abstract

The current practice of flood risk assessment focuses mainly on damages that can be easily measured in monetary terms, i.e. the so-called tangible damages on assets that have market values. However, quite often flood events are causing damages on assets that have no market values, e.g. environmental impacts, which usually are neglected. In this context, the present paper explores the potential of Contingent Valuation Method (CVM) to estimate the environmental costs of floods. CVM is a method widely used in environmental economics valuating environmental goods and services that have no market prices. In this case, it is applied to estimate the environmental costs of the severe flooding event that emerged in the Evros River (Greece) during March/April 2006. The environmental costs are elicited by asking three groups of local stakeholders (local scientific and administration experts, farmers and hunters) for their willingness to pay (WTP) to avoid such impacts, particularly on the soil, the biodiversity and the aesthetic environment. Additionally, the experts are asked to state in their opinion, which part of the regional gross domestic product (GDP) should be allocated to avoid environmental flood impacts in the Evros River. The opinions of the three local stakeholders groups were considered in the survey since they are the most informed parts of the population on such a complex issue. Consequently, both the WTP and GDP estimations do not represent the preferences of the wider local population. The findings of this valuation approach have the potential to contribute to a more comprehensive assessment and thus to a more unbiased flood risk management.