MONETIZING THE ENVIRONMENTAL WELFARE IMPACT OF DEFORESTATION IN OGUN STATE, NIGERIA: THE CONTINGENT VALUATION APPROACH
Keywords:
Willingness-To-Pay, bid, rainforest protection, environmental service functions, agro forestry.
Abstract
This paper investigated the economic valuation of alternative uses of rainforest land using the contingent valuation approach. Multi-stage sampling technique was used in the collection of the 260 respondents in the data from the four Ogun State Agricultural Development zones used for the study. Data were analyzed using descriptive statistics and the dichotomous-choice contingent valuation method that terminated into the logit model. Food crop cultivation accounted for 66.4% of deforestation. The households yearly Willingness To Pay/hectare (WTP/ha) for rainforest protection was N16,186.76. This translated to N0.60 billion for the 'average 36,817.62 hectares/year deforested for food crop cultivation. The key determinants of the likelihood to pay for rainforest protection were the bid, rainforest visitation, and immigrant status that had the coefficient of -0.0074. -0.11 and -0.71 and were significant (p<0.01) for bid and (p<0.05) for the others. In addition were the income, educational status and food crop producer status that had the coefficients of 0.13. .0063 and .00012 and were significant (p<0.01). Lower cost of rainforest protection as indicated by the WTP would lead to further deforestation and the consequent environmental impacts for a long time. There is therefore the urgent need for environmental sensitization through education to arrest deforestation.
References
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Whittington, D, Smith, V. K., Okorafor, A., Okorie, A., Lium, L., McPhail, A. 1992. Giving respondents time to think in contingent valuation studies: A developing country application. Journal of Environmental Economics and Management, 22: 205-225.
World Commission on Environment and Development 1987. Our common future: The Brudtland Report. Oxford University Press.
WWF 1989. Cross National Park, Oban Division: Plan for developing the park and its support zone. Goldaming: World Wide Fund for Nature.
Angelsen, A., Shitindi E.F.K., Aarrestad, J. 1998. On the economics of deforestation with regional panel data: evidences from Tanzania. Workshop Paper 0498, University of Bergen, Dept. of Economics, Norway.
Ardilla, S, Quironga, R., Vaughan, W.J. 1998. A review of the use of contingent valuation methods in project analysis at the Inter – American Development Bank, Environment Division. Working Paper ENV 126, Inter-American Development Bank.
Barbier, E.B., Burgess, J.C. 1996. Economic analysis of deforestation in Mexico. Environment and Development Economics,1(2): 203-239.
Bergland, O., Musser, W., Musser, I., Terry, K. 1987. Optimal sampling intensities in close-ended contingent valuation methods. Draft Paper, Department of Agricultural Economics, Oregon State University, Corvallis, Oregon.
Bishop, R.C., Herbelein, T. 1979. Measuring values of extra market goods: are indirect measures biased? American Journal of Agricultural Economics, 61: 926 -930.
Bowker, J.M., Stoll, J.R. 1988. Use of dichotomous-choice non-market methods to value Wooping Crane. American Journal of Agricultural Economics, 70: 372-381.
Brudtland Report, 1987. Oxford University Press.
Castle, E. N. 1996. Pluralism and pragmatism in the pursuit of sustainable development.
Adawomicz, W.L., Boxall, P.C., Luckert, M.K., Phillips, W.E., White, W.A. Eds. Forestry, Economics and Environment. CAB International. 1-9.
Cooper, J. C. 1993. Optimal bid selection for dichotomous-choice contingent valuation surveys. Journal of Environmental Economics and Management, 24: 25-40.
Cooper, J.C., Loomis, J. 1992. Sensitivity of willingness-to-pay to bid design in dichotomous-choice contingent valuation models. Land Economics, 68(2): 211-224.
FAO 1995. World agriculture towards 2010, an FAO study. N. Alexandratos Ed.
FAO United Nations and John Wiley and Sons.
FAO 1993. Forest resources assessment 1990, tropical countries. FAO Forest Paper 112, Rome.
FORMECU 1995. The assessment of land use and vegetation changes in Nigeria between 1976 and 1993/95. Report of a Study submitted by Geomatics International, Ontario, Canada. 55 – 56.
Gillis, Malcolm. 1996. Tropical deforestation. Paper Presented by the President, Rice
University at the 1996 Rice Environmental Conference, Rice University Held on Friday, February 2.
Hanemann, W.M. 1984. Welfare evaluations in contingent valuation experiments with discrete responses. American Journal of Agricultural Economics, 66: 332-341.
Hirsholeifer, Jack 1984. Price Theory and Applications. 3rd Edition, Prentice Hall International Inc.
Kaimowitz, D., Arild Angelsen 1996. Economic models of tropical deforestation: a review. Bogor, Indonesia: Center for International Forestry Research.
Kant, Shashi, Anke Redant 1997. An econometric model of tropical deforestation. Journal of Forest Economics, 3(1): 51-86.
Kramer, R.A., Mercer, E., Sharma, N. 1995. Valuing tropical rainforest protection
using the contingent valuation method. W.L. Adawomicz, P.C. Boxall, M. K. Luckert,
Phillips, W. E., White, W. A. Eds. Forestry, Economics and Environment. CAB International, 181-194.
Koutsoyannis, A. 1979. Modern microeconomics. 2nd ed. London: Macmillan.
Lazo, J.K., Schulze, W.D., McClelland, G.H., Doyle, J.K. 1992. Can contingent
valuation measure non-use values? American Journal of Agricultural Economics, 74(5):114-120.
Mayor, Federico 1988. Geographical information system for managing sustainable
development: The UNESCO approach. ITC Journal 1988: 4.
McCollum, D. W., Boyle, J. K. 2005. The effect of respondent experience/knowledge
in the elicitation of contingent values: An investigation of convergent validity, procedural invariance and reliability, Environmental and Resource Economics, 30(1): 23-33.
National Oceanic and Atmospheric Administration (NOAA) 1993. Natural resources damage assessments under the Oil Pollution Act of 1990. Federal Register, 58(10):4601-4614.
NEST, 1991. Nigeria’s threatened environment: A national profile. Ibadan: Nigeria Environment Study/Action Team (NEST).
Okojie, J.A. 1998. Once upon a forest: The master piece of creation. First Inaugural Lecture, Abeokuta: University of Agriculture.
Omotayo, A.M. 2003. Biological implications of fulbe pastoralism in Southwestern Nigeria. Land Degradation and Development, 14: 445-457.
Ryan, M, Ratecliffe, J., Tucker, J. 1997. Using willingness to pay to value alternative
model of antenatal care. Social Science and Medicine, 44(3): 371-380.
Solow, R. M. 1991. Sustainability: An economist’s perspective. J. Seward Johnson
Lecture, Woods Hole Oceanographic Institution, Marine Policy Centre, Woods Hole,
MA.
Tisdell, C. A. 1993. Environmental economics: Policies for environmental management and sustainable development. Edward Elgar Publishing Ltd.
Treben, M. 1986. Health through God’s pharmacy: Advice and experiences with
medicinal herbs. Ennsthaler 899, Austria.
Turcin, Branka, Giraud, Kelly 2001. Contingent valuation willingness to pay with respect to geographically nested samples: Case study of Alaskan Steller Sea Lion. 2001 W-133 Western Regional Project Technical Meeting Proceedings.
Whittington, D, Smith, V. K., Okorafor, A., Okorie, A., Lium, L., McPhail, A. 1992. Giving respondents time to think in contingent valuation studies: A developing country application. Journal of Environmental Economics and Management, 22: 205-225.
World Commission on Environment and Development 1987. Our common future: The Brudtland Report. Oxford University Press.
WWF 1989. Cross National Park, Oban Division: Plan for developing the park and its support zone. Goldaming: World Wide Fund for Nature.
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