Households' willingness to pay for forest conservation in Ethiopia: A review

Abstract

Environmental valuation studies in the context of developing countries have become more frequent in recent years. However, literature which reviews and examines the environmental valuation studies is limited. Thus, this paper performed a literature review on forest contingent valuation studies conducted in the Ethiopian context in the past two decades (2000 to May 2022), focusing on two specific objectives: (i) to examine amounts of resources that households are willing to pay (WTP) for forest conservation, and (ii) to identify determinants of households’ WTP. Results indicate the mean lower annual WTP of USD 0.41 (2.63 birr) and 7.04 man-days per household in money and labour time, respectively. Whereas the mean upper annual WTP of USD 53.52 per household in monetary payment and 94.34 man-days per household in labour time contribution are found for the management and conservation of forest in Ethiopia. The finding reveals that there is a limited proportion of the examined studies that included and estimated WTP in a non-monetary payment vehicle, implying a need for future researches on the topic. The result shows that demographic and socio-economic variables, physical assets ownership, institutional and infrastructural services and bid price variables were the main determinants of households’ WTP. This suggests that the forest conservation intervention program involving public participation in the country needs to consider the identified determinants of WTP in design and implementation of the program. Moreover, the finding indicates the presence of mixed results on the effect and direction in which some determinants of WTP are affected. This recommends a pressing need for comprehensive future studies on the research theme.