Assessing the non-timber value of old-growth forests in Sweden

Thomas Broberg ()
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Thomas Broberg: Department of Economics, Umeå University, Postal: S 901 87 Umeå, Sweden

No 712, Umeå Economic Studies from Umeå University, Department of Economics

Abstract: This paper estimates the public benefit of preserving 126 000 hectares of old-growth forest in the sub-mountainous region of Sweden through contingent valuation. The primary benefit of this in-situ conservation of biodiversity is the forest’s relative diversity and richness, which provides important habitat for threatened species. Thus, benefits arise predominantly from nonuse values. We find that a majority of the Swedish population is unwilling to contribute financially to the preservation project (median WTP equals zero). The estimated mean WTP is SEK 300, implying an aggregate benefit of SEK 9 billion. We estimate two types of valuation functions in order to reject the hypothesis that respondents state random numbers as their WTP. Firstly, a binary logit model indicates that variables related to a respondent’s education level, income level and concern about the environment are positively correlated with the likelihood of supporting the preservation project, while being a male and having an anti-environmental attitude towards public expenditures are negatively correlated. After controlling for whether or not locals are employed in forest-related industries, we find that locals, in general, are more likely to have a positive WTP. Secondly, we estimate a valuation function conditioned on respondents with a positive WTP and find that the size of their contribution is explained by income, general concern about the environment, and the motive underlying their valuation (e.g., use versus nonuse). No differences between locals and non-locals were found.

Keywords: contingent valuation; willingness to pay; social benefit; nonuse values; non-timber value; old-growth forest; preservation; conservation (search for similar items in EconPapers)
JEL-codes: Q20 Q23 Q26 Q28 Q38 (search for similar items in EconPapers)
New Economics Papers: this item is included in nep-agr, nep-dcm, nep-env and nep-ppm
Date: 2007-05-16
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Persistent link: http://EconPapers.repec.org/RePEc:hhs:umnees:0712

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