Valuation Of Non-market Goods Research Articles

Estimating the preservation value of the confucianism symbol tree: application of the contingent valuation method

ABSTRACT The main purpose of this study is to estimate the preservation value of the Confucianism symbol tree at Jeonju Hyanggyo, a traditional Confucian school in Korea during the Joseon Dynasty (1392–1910), using the contingent valuation method (CVM). CVM is widely used to estimate the economic value of non-market goods in the form of willingness-to-pay (WTP). The secondary purpose is to investigate whether perceived value is statistically related to WTP. A two-step approach is applied to reduce hypothetical bias. The results show that respondents are willing to pay 5,163 KRW (=4.57 USD) to preserve the Jeonju Hyanggyo tree. Further, respondents who perceive higher functional value are more likely to pay more.

Measuring the Economic Use Values of Recreation Resources in Protected Areas, Evidence from Nyerere National Park in Tanzania

Natural recreation resources play a central role in tourism activities in most part of the world as they are main source of tourist attractions. Despite this, little is known on the economic use values of natural recreation resources in Tanzania. Little information on the economic use values of natural recreational resources is attributed by market failure issues embedded with these resources as they belong to non-market goods and services which normally do not have actual market prices. In most instances these resources are considered free gifts of nature and in case they are priced their values are usually under estimated. Environmental valuation techniques can quantify the economic use value of non market goods and services such as natural recreation resources. This study employed the Individual Travel Cost Method to measure the economic use value of recreation resources in Nyerere National Park (NNP). Specifically, the study measured the consumer surplus per tourist per trip and estimated the annual recreation use value of the park. The study involved 215 tourists who were grouped into resident and non-resident tourists. Data were analyzed using STATA version 14 and a Zero Truncated Poisson Regression Model was employed to estimate tourists’ demand function. The findings show that consumer surplus for resident, non-resident and when the two groups were combined together were $62.25, $490.48 and $517.01 respectively. The annual recreation use value for resident, non-resident and both resident and non-resident tourists were respectively $89,017.5, $4,255,404.48 and $7,251,661.36. The recreational value estimated in this study underscores the significance of conserving recreation resources in NNP. It also demonstrates that recreation activities can contribute significantly to the country economy like other economic activities thus natural recreation resources should not be underrated due to their embedded market failures. The study concludes that NNP has a significant economic value which calls for the responsible institutions in the country to properly manage the park so as to ensure a continuous flow of these benefits. Specifically, the Ministry of Natural Resources and Tourism and Tanzania National Parks could use the findings of this study to improve tourism activities in NNP and the country at large by designing sustainable nature based tourism strategies which meet tourists’ preferences and country tourism goals. This will attract more tourists in the country which will increase the recreation values of NNP and other natural recreation areas.

Preserving the Culture of Jeju Haenyeo (Women Divers) as a Sustainable Tourism Resource

The culture of Jeju Haenyeo, the women free divers of Jeju Island, is inscribed on United Nations Educational, Scientific and Cultural Organization (UNESCO)’s Intangible Cultural Heritage list; however, it is proving difficult to maintain this status because, in the absence of conservation measures, the number of Haenyeo is decreasing. Therefore, the purpose of this study was to use contingent valuation to determine the economic value of preserving Jeju Haenyeo culture, which derives from visitor entrance fees, with the aim of justifying the preservation of this and other such intangible cultural resources. Despite its methodological advantage of allowing estimation of the value of non-market goods, the contingent valuation method (CVM) has been criticized because the hypothetical nature of the conditions can cause overestimation. To overcome that limitation, the respondents in this study reported their willingness to pay (WTP), and their responses were repeatedly confirmed to ensure their sincerity. The CVM estimate of the preservation value of Jeju Haenyeo culture was 17,308 South Korean Won. The results of this study serve as referential data on the value of cultural heritages and the need to preserve and utilize these resources.

Building the Modern State in Developing Countries: Perceptions of Public Safety and (Un)willingness to Pay Taxes in Mexico

What is the relationship between taxation and public safety? Contrary to studies suggesting that personal victimization and heightened perceptions of insecurity increase pro-social attitudes and support for state intervention in the form of greater taxation, this article argues that such concerns decrease willingness to pay taxes to address public safety. It estimates what citizens are willing to pay to reduce crime, using an original representative survey conducted in Mexico and relying on the contingent valuation method to assess the value of nonmarket goods. Attitudes toward taxation are found to respond to subjective, sociotropic assessments of public safety rather than to actual risk or occurrences of individual victimization. These findings counter the conventional wisdom that demand for personal security enables greater extraction, a central proposition in classic accounts of state building. Showing that willingness to accept heavier taxation may be weakest among those who perceive the gravest need for security, the study adds precision to theories of fiscal exchange.

Assessing the Preservation of Parks and Natural Protected Areas: A Review of Contingent Valuation Studies

The existence of parks is particularly important and offers many benefits both to the environment and to humans. Parks are recreational spaces, which contribute to the improvement of the microclimate, reduce atmospheric pollution and protect biodiversity. Their importance for the urban environment is even greater because they offer pure oxygen to the city and people feel close to nature in them. The aim of this study is to review studies which took place globally as well as in Greece, relying on the Contingent Valuation Method (CVM) for parks. The reason that this method is used is the valuation of non-market goods and services through the development of a hypothetical market. Additionally, a distinction is made among previous empirical studies depending on the nature of the parks and the country where the survey was conducted, while the disadvantages that must be considered from the use of Contingent Valuation Method are mentioned. According to the findings of the literature review, studies using Contingent Valuation in Greece, particularly in the case of urban parks, are limited. As far as we know, the valuation of existing urban parks has not yet been studied, so this could be a field for further research. The economic valuation of parks in a country like Greece, which suffered with the financial crisis, can lead to conclusions about the value that citizens attribute to parks and the identification of possible protest responses.

The Ecosystem Service Valuation and Federal Conservation Special Issue of ARER

AbstractValuing the ecosystem services delivered by conservation and stewardship programs is of interest within USDA and across the federal government. Answering these types of questions requires accurate and scientifically sound measures of Ecosystem Service Values (ESVs). While there is a rich literature on valuation of nonmarket goods, it is often difficult to use for the ESVs provided by USDA and other federal agencies. To advance understanding of the use of ESVs in conservation programs, this special issue of ARER presents selected papers from a 2019 workshop entitled “Applications and Potential of Ecosystem Services Valuation within USDA – Advancing the Science.”

Potential Use of the Life Satisfaction Approach to Value Nonmarket Goods and Services

Economic analysis often faces challenges in the valuation of nonmarket goods and services. The traditional set of nonmarket valuation tools for measuring Marshallian economic surplus has limitations related to potential bias in stated preferences and endogeneity of nonmarket amenity placement in revealed preference studies. The life satisfaction approach offers a Hicksian compensating variationbased alternative, which uses self-reported subjective well-being to calculate the marginal rate of substitution of income for nonmarket amenities or services. The conceptual basis for the approach is explained and illustrated with an example from Iloilo, Philippines. Recommendations are offered for future application of the technique in the economic analysis of investment projects.

Contingent valuation of forest environmental resources based on improvement in effectiveness: Taking the Minjiang river basin as an example

The Contingent Value Method (CVM) is quite important to the valuation of non-market goods or services, especially the non-use value of the environment and resources. This paper investigates residents’ willingness to pay for an ecological forest in the Minjiang River Basin, defines the specific composition of forest social value based on a logistic model and factor analysis, and calculates the average willingness to pay for ecological forest resources.

Contingency, cost, and a fracking ban: Extending sociological research with the contingent valuation method

Documenting patterns of environmental concerns has been a core effort of environmental sociology since the founding of the sub-discipline. Environmental economists, on the other hand, are pre-occupied with the valuation of non-market goods like ecosystems services and environmental policy. In this article, we argue that sociologists should cautiously embrace non-market valuation methods, particularly the contingent valuation method. We provide a motivating empirical example by considering the case of support for a fracking ban among residents of Colorado, USA. Our analysis suggests that Colorado residents’ support for a fracking ban is somewhat contingent upon the costs created by said ban. We then conclude by discussing how sociologists might extend research on non-market valuation with sociological insights.

Urban Water Body Recreational Development and Revitalizing Program in Sri Lanka: Public Perception and Willingness to Pay

Urban water body recreational areas add varied socio- economic and environmental benefits to the urban lives. This study explores public perception and their willingness to pay for open water area recreational development at Sri Jayewardenepura Kotte, Sri Lanka. A total number of 300 questionnaire surveys were carried out with users and non users of the recreational area. The monetary value of urban water front development was gauged by the contingent valuation method using payment card approach. Enjoying peace and relaxation, taking children to play and breath clean air were mentioned as most important aspects of open water body areas. More frequent visits occur to enjoy peace and relaxation, breath clean air and enjoy the natural landscape. Almost all the participants were agreed upon conserving open water body areas in urban settings. Willingness to pay was significantly associated with income and occupation status. It yielded a monthly average payment of Rs. Rs.446.93 per household for another five years time. There were 33 percent of zero bids. Limited budget was the main reason for not willing to pay. This study indicates the applicability of contingent valuation method in valuing economic value of non market goods in developing countries. The findings could assist future open water body development and conservation and argue the need of considering community views and expectations in relevant public spaces and policies. This paper is significant as there is no contingent valuation method study has been carried on water body development in Sri Lanka.

CHOICE EXPERIMENT METHOD IN FOREST ECOSYSTEM SERVICES VALUATION

The need to integrate value of forest ecosystem services (FES) into decision-making process is widely acknowledged. Nowadays economists propose two ways of uncovering the economic value attached to non-market goods and services: Revealed Preference methods and Stated Preference methods. One of the methods which allow determining the value of FES based on the Stated Preferences is the choice experiment method. This method was initially developed in marketing research and now is widely applied in the valuation of non-market goods and services. The choice experiment method relies on the Lancaster's theory that the utility of a good is derived from its attributes, and as a result of this, the value of the good is the sum of the values of all its attributes. The method combines this line of thinking with random utility theory which states that people choose the alternative with the highest expected utility. The aim of a choice experiment application in the field of FES valuation is to understand preferences and trade-offs within a particular population for a particular good or service. According to the logic of this method, a respondent is invited to choose the best of the list of alternatives, which differ in attributes and their levels. One of the alternatives is always status quo, or "I do not choose any one". This alternative is included in each set of choices, since one of the alternatives should be acceptable to the respondent. The advantages and disadvantages of the method are determined in this study, which must be taken into account in the process of study planning and interpretation of the valuation results. This method is useful from a policy and management perspective because the information it provides can be used in the design of multidimensional forest police, in cost-benefit analysis, and in litigation processes. Based on the study of this method application in FES valuation, the need of its application in Ukrainian forest decision-making is substantiated to enable holistic view on economic activity and adaptive forest management in the Anthropocene era.

Examining the Attributes of Electronic Waste Recycling Service: A Choice Modelling Approach

This paper estimates the economic valuation, discusses preferences for electronic waste (e-waste) recycling, and identifies the most preferred attributes in e-waste recycling. Stratified random sampling from the households in Putrajaya, Malaysia was utilised to obtain the primary data. It provides the readers with an intrinsic satisfaction when choosing a modelling analysis on the valuation of non-market goods using conditional logit simple model. The findings indicate that the option attributes were highly significant and there was no inherent bias towards either the change or no-change option held by the respondents.

Effectiveness of Flood Protection Project Valuation Methods

Projects for flood protection are increasingly the subject of investment projects in the field of water management. This is related to the increasing frequency of worldwide threats caused by extreme weather conditions, including extremely high rainfall causing floods. Technical and nontechnical flood protection measures are also increasing in importance. In the decision-making process, it is necessary to take into account both the costs and benefits of avoiding losses, including an analysis of social benefits, whose valuation of non-market goods is an essential element. A comprehensive account of projects in the field of flood protection based on the estimated costs and benefits of the investment allows the economic efficiency from a general social point of view to be determined. Previous evaluations of the effectiveness of investment projects have mainly taken into account only categories and market values. The aim of the article is to identify the possibilities to expand the values of non-market assessments and categories formulated on the basis of the theoretical economics of the environment.

순천만 생태복원에 따른 경제적 가치 평가

【Coastal wetlands are among the most productive biomes in the Earth. The economic values include the direct use of a coastal wetland's ecosystem services, such as food, raw materials, recreation, and tourism. Other values comprise the indirect use of a coastal wetland's ecosystem services, such as carbon sequestration, waste-water treatment, and erosion prevention. In particular, Suncheon Bay is recently attracting attention as the most successful case of the preservation and restoration. This study applies Travel Cost Method (TCM) to estimate the economic value by drawing the demand curve for trips to Suncheon Bay. The TCM is an approach used for economic valuation of non-market goods and services. Based on the results of TCM, this study shows that the economic benefit from recreational uses of the site adds up to \174.7 billion per year. It is also significant in the sense that monetary information is suggested to help local policy makers evaluate the realistic values of coastal wetlands.】

Can subjective well-being measures be used to value policy outcomes? The example of engagement in culture

Economic analysis of public policy invariably requires the valuation of non-market goods. The methods conventionally relied on by economists to estimate these values are, however, subject to a number of limitations, both methodological and philosophical. Given these concerns, economists have identified alternative valuation methods, such as the use of subjective well-being (SWB) measures. SWB measures hold much promise, but face a number of challenges before they can generate policy relevant outcomes. This article illustrates these challenges by applying the SWB approach to the valuation of engagement in culture. An analysis of the British Household Panel Survey is undertaken to estimate the value of going to the cinema and attending concerts. The approach was divided into two steps. First, the SWB impact of engaging in culture was estimated. Both fixed effects and random effects models were employed, and an instrumental variable was used to control for the endogeneity of income. Second, the value of engagement was estimated as the income compensation (IC) that would generate an SWB impact equivalent to engaging in culture. Both the impact of engagement in culture on SWB and the corresponding IC are thought to be overestimates. Possible explanations for this are considered to illustrate the research that is required before the SWB approach can generate rigorous estimates of value that are useful to policy makers. First, further research is required on the relationship between income and SWB, including methods for dealing with the direct and indirect impact of income on SWB. Second, further work is required to develop reliable instrumental. Third, work is required to understand the temporal relationship between policy outcomes and SWB.

Adjusting for Cultural Differences in International Benefit Transfer

Values for non-market goods can be expected to be sensitive to variations in the cultural contexts of beneficiaries. However, little progress has been made to date in adapting benefit transfer (BT) procedures for cultural variations. Using information from a study that ranked 62 societies with respect to nine attributes of their cultures, we develop an index that is then used to re-weight multiple coastal ecosystem service value estimates. We examine whether these culturally-adjusted BT estimates are statistically different than simply transferring the income-adjusted mean transfer estimates for each coastal ecosystem service from international study sites to the policy site. We find that once differences in income levels have been accounted for, the differences in cultural dimensions between study and policy sites actually have little impact on the magnitude of our transfer estimates. This is not a surprising result given that the majority of the study site estimates are derived from countries that share many ethnic, linguistic and other cultural similarities to the policy site. However, benefit adjustments based on cultural factors could have a much higher impacts in settings different to that investigated here.

Economic valuation of conservation of genetic resources of wild rice relatives : Assessing the preferences of adjacent community for conserving Oryza granulata in the Wavulpane area

This study was aimed to achieve the specific objective of assessing the preferences of adjacent communities for utilization, benefit sharing and conservation of the genetic resources of Wild Rice Relatives (WRR) in Sri Lanka and to explore the capability of setting the priorities for conservation and management of WRR based on these preferences. The “Wavulpane” village located in the Rathnapura district was selected as the case as: (a) it was reported to be one of the growing areas for the WRR of Oriza granulata, and (b) there were no weedy rice problems prevailing in this village. The “Choice Experiment Models” (CEM) [i.e. stated preference method used to obtain Option Values for non-market goods by exploring the individuals’ stated behavior in a hypothetical setting] were applied. The data were collected from 50 individuals who were well aware of the presence and potential importance of this particular WRR through a Participatory Community Appraisal (PCA) carried out with the support of a structured questionnaire designed specifically for the CEM. Outcome of the Choice Experiment, which used a Fractional Factorial Design to array four attributes and three levels in the choice sets orthogonally, shows that an individual in an adjacent community was Willing-To-Pay nearly Rs. 82 per year for in-situ conservation of WRR. The need of the hour is, therefore, to develop appropriate policy and institutional framework that works for this task to which both short and long term policies as well as stakeholder participation should be guaranteed (i.e. research stations, universities, NGOs)

Assessing the preferences of plant breeders for utilization, benefit sharing and priorization of conservation of wild rice relatives in Sri Lanka

The purpose of this study was to assess empirically the preferences of plant breeders for utilization, benefit sharing and conservation of the genetic resources of Wild Rice Relatives (WRR) in Sri Lanka. The “Choice Experiment Models” (CEM), i.e. stated preference method uses to obtain Option Values for non-market goods by exploring the individuals’ stated behavior in a hypothetical setting, were employed with the primary data collected from a panel of reputed plant breeders (n = 30) work at the administrative capacity in various reputed academic and research institutions in Sri Lanka. The data collection process was characterized by a face-to-face interview with each breeder during March to May 2009, which was supported by a structured questionnaire designed specifically for the CEM. The outcome of analysis shows that, from the breeders’ point of view, the benefit for an individual, in general, for conserving WRR for the future is nearly Rs. 10. Given the facts that there are not much significant direct uses of WRR revealed to date; there exists yet unrevealed benefits to the society (e.g. use of favorable genes in WRR to improve the quality of cultivated rice varieties), and the outcome of previous studies divulge that the gene sequence of different WRR populations belong to different geographical area varies significantly, the option value derived through this analysis implies that conservation of WRR can be done in-situ effectively, if people reside close to the areas where they are growing predominately would like to contribute more than the value that the scientists expected. The results highlight the importance of carrying out extensive economic research program focusing of the people adjacent to the areas where WRR growing to estimate such values as so would facilitate setting up alternative institutional arrangements (i.e. public / private) work for effective conservation of CWR, in general, and WRR, in particular.

The patrimonial value of water: How to approach water management while avoiding an exclusively market perspective

This article proposes an economic alternative to the traditional approach to calculating non-market values of the environment and natural resources, which we refer to here as “patrimonial”. We will first examine the traditional economic approach and its tendency to apply market categories to the economic valuation of non-market goods and services associated with the environment and natural resources. We will then move on to examine the way in which the question is perceived within the context of patrimonial economics by focusing on another form of economic rationality, based on the notion of a shared legacy or patrimony. Lastly, we will illustrate the tension between market values and patrimonial values in the field of water management and untreated water distribution infrastructure by analysing the recent evolution of Associations syndicales autorisées (“Authorized Union Associations”, or ASAs) in France and their approaches to pricing.

Measuring the Market Value of Non-Market Goods: The Case of Conspicuous Consumption

Although non-market goods are not directly allocated through markets, some of these goods are allocated through markets in an indirect fashion. Such is the case with conspicuous consumption: people buy market goods (e.g., clothing) to signal their wealth and then increase the probability of obtaining some non-market goods (e.g., admiration). We are the first to exploit that relationship to measure the market value of those non-market goods by using a revealed-preference approach. We estimate a signaling model using nationally representative data on consumption in the US. We then use this model to obtain welfare implications and perform a counterfactual analysis. Our estimates suggest that for each dollar spent on clothing and cars, the average household obtains approximately 35 cents in net benefits from non-market goods. The signaling mechanism seems to be a relatively efficient allocation mechanism because it attains almost 90% of the full potential benefits from non-market goods. The unattained benefits give an upper bound to the potential gains from economic policy (e.g., a tax on observable goods). The counterfactual analysis suggests that the proportional tax rate on observable goods that would correct the positional externality is in the order of 40%. Additionally, we calculate the unique non-linear tax schedule that would fully correct the externality. Finally, we show that accounting for the consumption of these non-market goods increases the Gini index of consumption inequality by almost 4%.