Sunday, February 14, 2016

Paying for Forest Ecosystem Services: Voluntary Versus Mandatory Payments

The emergence of new markets for forest ecosystem services can be a compelling opportunity for market diversification for private forest landowners, while increasing the provision of public goods from private lands. However, there is limited information available on the willingness-to-pay (WTP) for specific forest ecosystem services, particularly across different ecosystem market mechanisms. We utilize survey data from Oregon and Washington households to compare marginal WTP for forest ecosystem services and the total WTP for cost-effective bundles of forest ecosystem services obtained from a typical Pacific Northwest forest across two value elicitation formats representing two different ecosystem market mechanisms: an incentive-compatible choice experiment involving mandatory tax payments and a hypothetical private provision scenario modeled as eliciting contributions to the preferred forest management alternative via a provision point mechanism with a refund. A representative household’s total WTP for the average forest management program was estimated at $217.59 per household/year under a mandatory tax mechanism and $160.44 per household/per year under a voluntary, crowdfunding-style, contribution mechanism; however, these estimates are not statistically different. Marginal WTP estimates were assessed for particular forest ecosystem service attributes including water quality, carbon storage, mature forest habitat, and public recreational access. This study finds that survey respondents place significant economic value on forest ecosystem services in both elicitation formats and that the distributions of the marginal WTP are not statistically significantly different.
Scenic of ponderosa forest, Wallowa-Whitman National Forest. 

by Gabrielle E. Roesch-McNally and Sergey S. Rabotyagov
Environmental Management via Springer
Volume 57, Issue 3; March 2016, First online: December 11, 2015; pages 585-600
Keywords: Forest ecosystem service Provision point mechanism Preference elicitation Stated choice Payment mechanism Crowdfunding

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