David Oglethorpe

Economic Valuation of the Non-use Attributes of a Wetland: A Case-study for Lake Kerkini

Wetlands are an environmental feature which deliver a variety of market and non-market goods and services. Established environmental economic theory separates the value of these goods and services into direct-use values, indirect-use values and non-use values. Given appreciation of all three, measurements can be derived to demonstrate the amount of public money that it may be feasible to allocate to the sustainable management of wetlands. However, in many cases, non-use values are ignored and the total economic value of wetlands can be severely undervalued. As a result, inadequate resources are fed into their management and environmental degradation occurs due to inappropriate commercial exploitation of the natural resource. Lake Kerkini, in northern Greece, is one such wetland area threatened by undervaluation and overexploitation for commercial purposes, and a resource whose management would benefit from the realization of non-use values. This study therefore uses the contingent valuation method to place a value on the non-use attributes of Lake Kerkini. It also examines the relationship between the revealed non-use values and the distance people live from the lake, highlights the personal characteristics which appear important in determining total willingness to pay and breaks total non-use value down into its component parts to suggest the most important non-use elements. The paper concludes that sustainable management of the lake is justified and provides evidence that substantial public monies are potentially available to protect and enhance the environmental value of the resource.

Modelling the transfer of the socio-economic benefits of environmental management

An important characteristic of changes in policy towards the farm sector, and farm land, is the increased emphasis on the production of environmental “goods”, such as landscape and wildlife. In order to justify taxpayer burdens to derive such goods through environmental management schemes, the benefits to society which such schemes deliver and the socio-economic interactions of environmental good provision is of major concern to policy-makers. This has led to a number of government-sponsored studies which have used methods such as Contingent Valuation to estimate the benefits of, for example, a number of Environmentally Sensitive Areas (ESAs). Such studies are expensive to carry out and consequently, academic endeavours have also been directed towards the study of Benefits Transfer, where we try to infer the benefit derived from one ESA (for example) as representative of the benefit derived from another ESA. This study reviews briefly the theory of Benefits Transfer and develops a rule-based model in a familiar Microsoft Excel environment for estimating the value of environmental features. Predictions made by this model are tested for robustness against stated preference data and recommendations are made regarding the efficiency of its potential application.

ECOLOGICAL ECONOMIC MODELLING OF THE CONSERVATION OF THREATENED HABITATS: HEATHER MOORLAND IN THE NORTHERN ISLES OF SCOTLAND

This paper describes the results of an ecological-economic modelling exercise of the management of a scarce habitat, namely heather moorland. The Orkney Islands of Scotland are used to illustrate a modelling approach which could be easily applied elsewhere, and to other habitats. We describe the evolution and present condition of heather moorland on Orkney, then quantify the extent of over-grazing (leading to ecological damage) on a spatial basis. This is accomplished using a model of heather utilization and heather productivity. Critical grazing limits are then used as constraints in an economic model of farm production decisions, which enables us to quantify the minimum necessary compensation payments which farmers should be offered to offset income losses due to grazing restrictions. Such a policy is in line with European Union and UK agri-environmental policy, which typically uses payments for income forgone as a means of persuading farmers to protect environmental quality.

Farm characteristics and the vegetative diversity of grasslands in the North of England: a policy perspective

A survey of 36 fields across 11 farms in the North of England was conducted to record the plant species diversity of grassland communities under various base conditions. Data pertaining to topographical advantage, farm management strategy and soil type were also collected for each field site. The relationship between management inputs and base environmental conditions and the resultant diversity of flora were identified through ordination techniques. The results show a total of 111 species being observed across the sample and some expected relationship emerge, but they also suggest that complementary management techniques can have opposing or conflicting effects on species prevalence. The study argues that provision or use of such information should be paramount within environmental policy formulation where site-specific management plans are used to produce environmental goods.