Economic Valuation of Kol Wetlands. Binilkumar A.S. A. Ramanathan

Transcription

1 Economic Valuation of Kol Wetlands Binilkumar A.S. A. Ramanathan Indian Institute of Technology Bombay, Mumbai, India A Conference on Ecosystem Services (ACES) December 8-11, 2008 Naples, FL

2 Introduction Wetlands Most important ecosystems Diverse goods and services Negligence- Undervaluation- Degradation Need for non-market valuation Contingent Valuation Method 2

3 Objectives To study the socio-economic dimensions of the stakeholders of the Kol wetland To study the relationship between the socioeconomic variables with the perception of stakeholders over the improved conservation of Kol wetland To find out the determinants of willingness of pay of the stakeholders for the improved conservation of Kol wetland To estimate the total economic value of Kol wetland in a contingent valuation framework. 3

4 Contingent Valuation Method Most popular stated preference method WTP/WTA : non-use/existence values Gained popularity and legal validity after NOAA Panel report 1993 Open, single-bounded, Doublebounded, Double-bounded with follow up question 4

5 Focus Group Interviews 3 different areas and stakeholder groups Major issues discussed Dependencies/Benefits Constraints/Conflicts Perception on improvement Willingness to pay 5

6 Study Area Part of Largest Ramsar Site in India Numerous Benefits(Paddy, Fish, Birds, Recreation, etc.) Facing high rate of degradation (reclamation, sand mining, clay mining, unsustainable agri. practices) 6

7 Sample of the study 100 urban households 50 divisions of Thrissur City Corporation Stratified random sampling Period of Survey: March to July

8 Results and Discussion: Socio-economics Category wise Classification of the Households 2.6% 28.9% 68.6% Majority of Population Belong to General category General Category Other Backward Community Scheduled Castes Distribution of Househods Based on the Family Size 70.9% Family Size varied between 1 and 14 with a mean of 4.5 and SD of 1.6 Number of Households % 25.4% 0.6% Below Above 9 Family Size(in Nos) 8

9 Results and Discussion: Socio-economics Education wise classification of the households 6.6% 23.1% 13.4% 6.0% 10.3% Primary Higher Secondary Bachelors Largest component in the Occupation pattern among the decision makers of the household found to be Pensioners followed by business 40.6% Secondary Technical Diploma Post Graduation 100 % Literacy found among the decision maker of the households Occupation wise classification of the Hosueholds 5.1% 4.0% 14.0% 26.0% 18.9% 28.3% 1.4% Govt. Employee 2.3% Private Employee Pensioner Farmer Manual Labourer Business Housewife Others (incl Gulf) 9

10 Results and Discussion: Socio-economics Income wise distribution of households (in INR) 20.9% 10.9% 6.3% 6.9% 10.0% 19.7% 25.4% Below Above Income varies between INR with a mean of INR 139,608 and SD of INR 106,545. Majority of the households fall under the income category of INR

11 Results and Discussion: Socio-economics wetland by the Households Water 9% Scenic Beauty 1% All 58% Selected features of Kol Paddy Fields 32% Majority identified all four attributes to be important and need to be conserved Interest-wise classification of the Households 95 per cent showed interest in the improved conservation of Kol wetland Moderate Interest 35% No Interest 5% High Interest 60% 11

12 Results and Discussion: Socio-economics Percentage 100% 90% 80% 70% 60% 50% 40% 30% 20% 10% 0% Distance wise classification of the perception on wetland Improvement Below Above 20 Distance from Kol Wetland (in Kms) No Interest Moderate Inerest High Interest The Distance found to be an influencing factor in formulating perceptions among the stakeholders. 12

13 Results and Discussion: Socio-economics Age-wise classification of perception of stakeholders on Wetland Improvement Interest for Wetland Improvement Age Group Below 40 Yrs and above Total Highly Interested 3(100.00)* (4.29)** 28(71.79) (40.00) 23(74.19) (32.86) 10(52.63) (14.29) 6(75.00) (8.57) 70(70.00) (100.00) Moderately Interested 0 11 (28.21) (37.93) 8(25.81) (27.59) 9(47.37) (31.03) 1 (12.50) (3.45) 29(29.00) (100.00) Not Interested (12.50) (100.00) 1(1.00) (100.00) *- Percentage of the horizontal total;**-percentage of the vertical total Total 3(100.00) (3.00) 39(100.00) (39.00) 31(100.00) (31.00) 19(100.00) (19.00) 8(100.00) (8.00) 100(100.00) (100.00) 13

14 Results and Discussion: Socio-economics Education-wise classification of perception of stakeholders on Wetland Improvement Interest for Wetland Improvement Education Primary Secondary Higher Secondary Technical Diploma Bachelors Post Graduation Total More Interested 3(50.00)* (4.29)** 24(66.67) (34.29) 8(53.33) (11.43) 7(87.50) (10.00) 19(82.61) (27.14) 9(75.00) (12.86) 70(70.00) (100.00) Moderately Interested 2(33.33) (6.90) 12(33.33) (41.38) 7(46.67) (24.14) 1(12.50) (3.45) 4(17.39) (13.79) 3(25.00) (10.34) 29(29.00) (100.00) *- Percentage of the horizontal total;**-percentage of the vertical total Not Interested 1(16.67) (10.00) (1.00) (100.00) Total 6(100.00) (6.00) 36(100.00) (36.00) 15(100.00) (15.00) 8(100.00) (8.00) 23(100.00) (23.00) 12(100.00) (12.00) 100(100.00) (100.00) 14

15 Results and Discussion: Socio-economics Income-wise classification of perception of stakeholders on Wetland Improvement Interest for Wetland Improvement Annual Income (in Rs) Below 50,000 50, , , , , , , , , ,000 Above 300,000 Total More Interested 7(63.64)* (10.00)** 9(47.37) (12.86) 16(69.57) (22.86) 9(81.82) (12.86) 11(68.75) (15.71) 6(100.00) (8.57) 12(85.71) (17.14) 70(70.00) (100.00) Moderately Interested 4(36.36) (13.79) 9(47.37) (31.03) 7(30.43) (24.14) 2(18.18) (6.90) 5(31.25) (17.24) 0 2(14.29) (6.90) 29(29.00) (100.00) *- Percentage of the horizontal total;**-percentage of the vertical total Not Interested 0 1(5.26) (100.00) (1.00) (100.00) Total 11(100.00) (11.00) 19(100.00) (19.00) 23(100.00) (23.00) 11(100.00) (11.00) 16(100.00) (16.00) 6(100.00) (6.00) 14(100.00) (14.00) 100(100.00) (100.00) 15

16 Results and Discussion-CVM The Elicitation format of WTP Question If Yes X INR 100 2X INR 200 If Yes/No Maximum WTP Double-bounded Dichotomous CVM model with a follow up Question of Maximum WTP If No If Yes/No ½X INR 50 Source : adapted from Markandya et.al,

17 The proportion of the stakeholders' on the basis of their willingness to pay 3% 97% Results and Discussion-CVM Majority of the household expressed their WTP for the improved conservation of Kol Wetland Willing to Pay Not Willing to Pay Classification of the Household Based on the maximum WTP WTP of majority of household ranged between INR Percentage of Households zero Above 500 Maximum WTP (in INR) 1 17

18 Results and Discussion: CVM Income-wise classification of the Maximum WTP Above Annual Income (in INR ('000)) Below Percentage of Households Above 500 Positive relationship of WTP with Income 18

19 Determinants of WTP: A Regression Analysis The linear forms of the equations are Results and Discussion: CVM MAXWTP= α+ β1 AGE + β2 EDULEVEL + β3 FAMSIZE + β4 ANNINCOME + β5 DISTKOL + β6 CONSINTEREST + β7 LOGLAND MAXWTP= α+ β1 AGE + β2 EDULEVEL + β3 FAMSIZE + β4 LOGINCOME + β5 DISTKOL + β6 CONSINTEREST + β7 LOGLAND 19

20 Results and Discussion: CVM Determinants of WTP: A Regression Analysis Sl No Variable Definition Exp. Sign 1 AGE The age of the decision maker of the +ve household 2 EDULEVEL Education Level of the decision maker +ve 3 FAMSIZE Family size of the household +ve 4 ANNINCOME Annual income of the household +ve 5 DISTKOL Distance of the households from Kol Wetland 6 CONSINTEREST Conservation interest of the household(1- Not Interested, 2- Moderately interested, 3- Highly Interested 7 LOGLAND Logarithm of the total land holding of the household 8 LOGINCOME Logarithm of Annual income of the household -ve +ve -ve +ve 20

21 Results and Discussion: CVM Determinants of WTP: Descriptive Analysis Sl No Variable Mean SD 1 AGE EDULEVEL FAMSIZE ANNINCOME DISTKOL CONSINTEREST LOGLAND LOGINCOME

22 Results and Discussion: CVM Determinants of WTP: A Regression Analysis Model 1 R Adj R F * Variable Coefficients T value Standardized Coefficients Constant ** AGE **.161 EDULEVEL FAMSIZE ANNINCOME *.470 DISTKOL ** CONSINTEREST *.321 LOGLAND **

23 Results and Discussion: CVM Determinants of WTP: A Regression Analysis Model 2 R Adj R F * Variable Coefficients t Standardized Coefficients Constant * AGE **.191 EDULEVEL FAMSIZE LOGINCOME *.454 DISTKOL *** CONSINTEREST * LOGLAND *

24 Total Willingness to Pay Results and Discussion: CVM Mean WTP : INR Median WTP = INR 200 SD WTP: INR Total Population of Thrissur Municipal Corporation :317,526 Average Family size :4.5 Total Household: Population/Family size =317,526/4.5=70,563 Total WTP/Annum =Median WTP*Total HHs= 200*70,563 = INR 14,112,600/ Annum 24

25 Summary and Conclusions The assessment of the interest of the stakeholders for the improved conservation of the wetland has shown that more than 95 per cent of the urban stakeholders are interested in improved conservation and management of their nearby wetland (Kol Wetland). It may be noted that 60 per cent of the stake holders are very highly interested. The stakeholders are also willing to contribute a part of their income annually for the environmental, and thereby, the social cause of preservation of the wetland 25

26 Summary and Conclusions The socio economic features of the households, in general, influence the value perception of the stakeholders : Annual income is found to have more significant and positive relationship with the maximum WTP As expected the maximum WTP found to have an inverse relationship with the distance of the household from the wetland. 26

27 Summary and Conclusions Using the Contingent Valuation Method,it is found that the maximum WTP of the households varied between 0 and INR 1,000 per annum with a mean of INR and a standard deviation of INR The median WTP was found to be INR 200. The majority of the households is willing to contribute an amount between INR 200 and 300. The total willingness to pay for the improved conservation is estimated to be INR 14,112,600 per annum. 27

28 Implications of the findings which are, however, theoretical, in nature: (i) Insignificance of educational level (ii) Farmers perception & role [ Based on these points, Government s & NGOs roles become important] (iii) Role of income, urbanization & Age [Based on the point (iii), the theory of environmental development in developing countries like India gets propounded} 28

29 Thank you 29