Abstract
Economic valuation of environmental goods is one of the most important aspects of the subject environmental economics. The key reason behind widespread destruction and degradation of natural resources is that the issue of environmental conservation and sustainable development is undervalued in developing countries. Such an outcome is due to the inability to understand the actual economic valuation of natural resources.
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Notes
- 1.
Hedonic pricing and travel cost methods are based on use value of the good/service/resource whereas contingent valuation method is based on non-use value of the good/service/resource.
- 2.
In this context, the consumer can be treated as both consumer as well as the producer of the good.
- 3.
The cost of time can be calculated in various ways. One common way is to consider the hourly wage rate that is foregone by the individual due to the visit. It is nothing but the concept of opportunity cost in Economics.
- 4.
We have followed the methodology as shown by Haraou et al. (1998).
- 5.
The choice of the model depends on the probability distribution of the error term where probit is used if the error term follows a normal distribution and logit is used if the error term follows a logistic distribution. However, most of the studies that used DC format follow the logit model since the difference between the two is minor and the logistic function is simpler to deal with.
- 6.
- 7.
We attribute this high response rate to the ‘face-to-face in-person interviews’ that we have conducted, as suggested by the NOAA panel as developed by Arrow et al. (1993). One more reason for such high response rate could be the fact that we have seen the degree of forest dependency is 100% for the people of our surveyed areas. So, regarding upliftment of forestry, they might be very eager to respond in their own interest.
- 8.
Protest bidders are those who do not prefer the stated programme and therefore provide zero WTP value.
- 9.
This procedure of throwing a dice twice before offering a particular bid to the respondent was followed for bringing simplicity in the survey process.
- 10.
Most of the variables used in this model have been selected after going through the literature on CV technique.
- 11.
The ratio of probability of willingness to pay (Pi) and non-willingness to pay (1 − Pi). It is to be noted that as 𝑃𝑖 increases the log-odds ratio increases.
- 12.
Variance inflationary factor (VIF) measure how much the variance of the estimated regression coefficients is inflated as compared to when the predictor variables are not linearly related. This is used to describe how much multi-collinearity (correlation between predictors) exists in a regression/logit analysis. When there is no collinearity, VIF will be 1.
- 13.
1/VIF is known as tolerance.
- 14.
As ‘the rule of thumb’, if 1 < VIF < 5, it implies variables are moderately correlated and if 5<VIF<10, then the variables are highly correlated.
- 15.
The only reason before the family size may be due to the fact that large family size can cause relatively less per-capita income and hence reduces the maximum WTP to conserve forests.
- 16.
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Acknowledgements
Some parts of the present work is related to an earlier research of the second author, though the present study is widely different from his earlier research. The authors are indebted to Professor Kausik Gupta, Department of Economics, University of Calcutta, for his valuable comments and suggestions on an earlier draft of the paper. However, remaining errors, if any, that exist in the paper are the sole responsibility of the authors.
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Gupta, A.C., Chatterjee, N. (2021). Economic Values for the Environment with Special Reference to the Contingent Valuation Method. In: Sikdar, P.K. (eds) Environmental Management: Issues and Concerns in Developing Countries. Springer, Cham. https://doi.org/10.1007/978-3-030-62529-0_14
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