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Nexus of the awareness of ecosystem services as a “public-benefit value” and “utility value for consumption”: an economic evaluation of the agricultural culture of Satoyama in Japan

Abstract

Japan’s rural areas are known for their natural environments being a source of ecosystem services. Today, the management and utilization of natural resources are essential themes for the sustainability of rural areas in Japan. And, since population decrease and aging are simultaneously advancing in the rural area, the contribution of the neighboring urban area residents is indispensable. However, empirical studies on how the value of ecosystem services is understood by urban residents and contributes to their intentions in rural development strategies that promote regional vitality by encouraging their behavior change, such as participation in community activities and the purchase of traditional products, are insufficient. This study investigated the influence of public awareness on the hypothesis that ecosystem services are of public-benefit value on investment-related indirect conservation activities. The contingent valuation method was employed to estimate citizens’ willingness to pay (WTP) against the results of regional revitalization activities in which unique branding was used for local agricultural products and traditional recipes. A full model analysis of the determinants of WTP was conducted. Revitalization plans for rural areas involving specially branded Japanese pickled vegetables offered ~ 40% added value compared to that of ordinary commodity foods. However, the tendency with regard to ecosystem services as a provider of public benefits was not a significant factor influencing participation in conservation efforts; the two were not correlated. That is, general value recognition of ecosystem services in the agricultural mountain village region and concrete value recognition as a consumption object were not linked.

Introduction

Background

While some rural areas in Japan have become popular owing to their natural environment, cultural resources, and tourist attractions, other areas face a depopulation crisis. Most of these areas are referred to as Satoyama or Satoumi, where the coexistence of humans and nature is critical (Kumar et al. 2012). Moreover, how to increase the number of individuals and groups contributing to natural resource management is an issue in many regions.

Across Japan, there have been attempts to capitalize on the recent interest in Satoyama or Satoumi regions and channel this interest into rural regions in the form of consumption or aid to “invigorate” areas by making them more socially and economically sustainable. The accreditation of globally important agricultural heritage systems (GIAHS) for 11 sites in Japan is a prime example of this effort in 2020. GIAHS are defined as “remarkable land-use systems and landscapes that are rich in globally significant biological diversity evolving from the co-adaptation of a community with its environment and its needs and aspirations for sustainable development” (FAO 2018).

In recent years, the increase in private capital for ecosystem management has been prompted by opportunities arising from the 2010 revision of the corporate activity charter based on ISO 26000. Consequently, creating shared value (CSV) within the local community is being promoted as an important part of business.Footnote 1 In 2015, a geographical indication law was introduced to authenticate regional farm product brands and food cultivated in specific areas (Tashiro et al. 2018). In some areas, attempts were made to strengthen the quality control of branded agricultural/fishery products and enforce market competitiveness (Ishida and Fukushige 2010; Sato and Kohsaka 2017). Attempts were also made to use local activities to achieve autarkic natural resource management by bringing an external workforce and funds to the area, which is usually favored by locals (Yamashita 2014).

Some researchers warn against using natural resources in a market economy because commodified services destroy social systems (Polanyi 2001). Furthermore, Japanese national and local government budgets are severely constrained to support natural resources and landscape conservation (Chen et al. 2018). Therefore, it is important to increase the momentum of spontaneous environmental conservation movements, even if these efforts receive some economic support for their activities.Footnote 2 Spontaneous actions require consensus that ecosystem services and the traditional culture of rural areas are “public-benefit values,” which must be protected. Regarding the link between general value recognition for these ecosystem services and value recognition as a consumption object, academic interest and practical needs from policymakers and regions aiming at regional activation are high.

Research objective

A marketing strategy based on stakeholder perceptions and evaluations of goods (ecosystem services) is essential to the above scheme (Collis and Montgomery 1997). This study analyzed consumer behavior to determine whether empathy for ecosystem services and the importance of traditional culture can result in changes in consumer consciousness by using a sense of “public benefit” as a critical concept in this analysis. It is expected to lead to spontaneous participation in the conservation of the natural environment.Footnote 3 Suppose this study can attribute the environment-related behavior of urban inhabitants to their cognition to values of the “public-benefit” of ecosystem services. In that case, the results will be significant for regional planning and environmental management.

A local project in a rural area in Japan was used as a case study to explore how the socio-ecological system of a mountainous area could be revitalized. The local revitalization project studied in this analysis is the Kinameri settlement in Hakusan city, Ishikawa prefecture (K-project). The study site produces high-quality vegetables, such as carrots and Japanese radishes; therefore, residents decided to launch a signature agricultural product made from products harvested in this area: additive-free Japanese pickled vegetables (JPVs) produced via traditional methods from agricultural products grown locally. Money earned from the JPVs was assumed to contribute toward the conservation of the natural environment. The main purpose of the study is to evaluate consumer consciousness for this particular case.

Research outline

To economically evaluate the value of ecosystem services, which have strong public goods characteristics such as non-exclusivity and non-competitiveness, it is practical to use a stated-preference model based on the contingent valuation method (CVM). This is a method to estimate peoples’ willingness to pay for a real or a virtual good at any price (Venkatachalam 2004). The CVM is used to estimate the economic value of various ecosystems and environmental services (Chaudhry et al. 2007; Rathnayake 2016). The evaluation using the CVM considers people’s consciousness and how it drives them toward engaging in environmental conservation actions.

Muranaka and Terawaki (2005) evaluated of willingness to pay (WTP) and willingness to work (WTW) of residents for the conservation of environments in Satoyama through voluntary activities. CVM has been applied to evaluate WTP not only for the direct conservation of environmental resources (Park et al. 2013) but also for the additional cost of renewable energy use (Lee et al. 2017). CVM has also been used to evaluate unique products sourced from local traditional resources (Hall et al. 2004; Yamashita 2013), to assess consumer preferences for goods not treated in the market (Donovan and Hesseln 2004), to estimate costs of conservation projects (Hutchinson and Chilton 1999; Lee and Yoo 2016), and to quantify losses in the natural environment (Lehtonen et al. 2003; Siew et al. 2015).

This study evaluates the value of natural environments from the consumers’ perspective. Some qualitative studies assert the importance of endogenous agriculture for constructing sustainable Satoyama (Berglund et al. 2014; Dublin and Tanaka 2014; Fukamachi 2016); however, for agriculture to be sustainable, farmers need to be sustainable, meaning that consumers’ evaluation of agricultural products is critical. To date, implications from previous studies evaluating the environmental value of local areas based on consumer purchasing attitudes have been various owing to the diversity of regions and resources. Therefore, additional research regarding the recognition of ecosystem services and consumption behavior is needed to improve the generalizability of these findings. CVM is also used to evaluate the WTP as a measure of the validity of public projects (Blaine et al. 2005; López-Mosquera et al. 2014; Wang et al. 2013) and ecosystem services (Chen and Hua 2015). This study uses the estimated WTP as an index and considers the significance of the public-benefit value. It has been demonstrated that consumers tend to pay more when factors influencing agricultural production are presented that stimulate consumer sentiment (Otieno 2018). In the past, the recognition that Satoyama in Japan is important from the perspective of biodiversity conservation was not relatively high (Iwata et al. 2011), but citizens’ consciousness may be evolving due to the spread in recognition of GIAHS and SDGs. Therefore, the evaluation of Satoyama as a public-benefit value encompassing the importance of both biological and cultural diversity can affect consumer behavior.

Data and methods

Data collection

The questionnaire for CVM was distributed to the residents of Nonoichi city, which is contiguous with Hakusan city, Ishikawa prefecture, Japan. The locations of both cities are shown in Fig. 1. The essential characteristics of the K-project are the establishment of manufacturing sites and the subsequent sale of JPVs and other specialty agricultural products in a farmer’s market. Generally, farmer’s markets offer the attractiveness of a rural environment, the availability of fresh produce, and employment opportunities for local senior residents. The K-project aims to realize all these functions.

Fig. 1
figure1

Location of the study area

The questionnaire was used to quantitatively analyze respondents’ attributes, experiences, and the influence that their view on natural resource benefits has on consumer behavior. Hence, the questionnaire focused on the following critical determining factors: site, quality, and price. The key indicators used to characterize urban residents were age, the use of and excursions to a natural environment, subjective awareness of natural resources as public benefits, and the intention to visit a farmer’s market in the Kinameri settlement (K-settlement). In addition to the offer price used for the analysis, goods, for which these factors were combined at random, were described on the questionnaire sheet. The data were then compared with the data of the other goods to evaluate consumer preferences. One thousand three hundred sixty-five questionnaires were distributed, and 917 were completed. The overall completion rate was 67%. To apply CVM to a multiple-attribute evaluation including the proposed price, the descriptions of the scenarios must be easily understood by the respondents. Furthermore, at least 800 respondents are required to guarantee the reliability of the results (Kuriyama et al. 1999). In this regard, the analysis results were considered appropriate because the questionnaire was simple to understandFootnote 4 and more than 900 samples were acquired.

First, the “site” was assessed based on a comparison of the typical supermarket visited by residents and the farmer’s market that was to be set up in the K-settlement. Next, an objective indicator was used to assess the “quality” (i.e., a product containing common preservatives commonly seen in JPVs in the market and natural products without preservatives were compared). For the “price” factor, a standard price of ¥200/200 g was used,Footnote 5 which was based on the results of the market survey conducted near the target area. Finally, the amount that the consumers were willing to pay for JPVs considering the previously discussed determining factors was calculated using the double-bounded dichotomous-choice CVM. The double-bound dichotomous-choice CVM is a statistical method that can estimate WTP more precisely if it is applied considering the disadvantage that the questionnaire becomes more complicated (Hanemann et al. 1991; Yoo and Yang 2001).

Analytical procedure

Four JPVs with different characteristics, including price, material, and the manufacturing method, were presented as alternatives to similar goods in the study, using the CVM. Each respondent chose JPVs four times in response to different questions (Fig. 2).Footnote 6

Fig. 2
figure2

Flow of replies to four repeated questions

The questions included in the survey to understand the personal attributes and characteristics of consumption behavior and a summary of the statistics of the survey results are shown in Table 1. Question 3 is related to consumers’ experiences with natural- environment conservation. Question 4 is connected to future decisions to participate in such activities. Questions 5 and 6 are related to the subjective awareness of consumers regarding the benefits and conservation of the natural environment. Question 5 is about the extent to which an area is considered beneficial, while Question 6 asks about the burden of responsibility. The same response options are provided for these two questions.

Table 1 Willingness to pay (WTP) influence factors and responses to each question

The results from Questions 5 and 6 were primarily used to assign a value to each respondent, indicating their perceptions of public benefits and responsibilities, i.e., their opinions about who benefits from and who is responsible for the conservation of ecosystem services. Respondents are rated as the “free-rider type” if they select a more significant number in Question 5 than in Question 6. On the contrary, they are rated as the “public benefit-oriented type” if the number chosen in Question 5 is less than that in Question 6. Respondents are rated as the “neutral type” if the numbers selected for both questions are equal. The distribution of responses to this questionnaire is shown in Fig. 3.

Fig. 3
figure3

Distribution of perceptions of scope of benefits and scope of liability for ecosystem services

Question 7 addresses the degree of understanding of the value of benefits of the natural environment, based on a clear distinction between the value of the natural environment and the urban environment. Question 8 includes a section that separates respondents who should be excluded from the analysis. It is assumed that the opinions of respondents who are not willing to visit the direct sales office may create a bias in the aggregate results. Therefore, questionnaires where respondents selected response 3 (“Do not want to visit at all”) to Question 8 were excluded.

The proposed price was increased or decreased based on responses to the first question regarding preferences (see Fig. 2). The double-bound dichotomous-choice method was adopted to estimate the WTP based on the responses to different proposed prices (described in Table 2 concisely). Bias in the second stage of selection has been confirmed in studies that have used this method to evaluate the environmental value of natural resources in developing countries (Gelo and Koch 2015). However, the method can still be applied to cases in Japan because it is normal for individuals to understand the quality and production process of goods and evaluate the corresponding price. A parametric random utility model (logarithmic linear logit) was used to investigate the relationship between the WTP and the factors related to public awareness.

Table 2 Results of double-bounded dichotomous choice categorized by answer pattern

The Excel CVM Version 4.0 add-on (http://kkuri.eco.coocan.jp/), developed specifically for environmental assessment and analysis, was used to calculate the WTP and the contributions of the factors to the WTP were determined using SPSS Version 22. The consumer’s evaluation on the package design of planned items was excluded from the analysis items because the design of the image of the questionnaire respondents cannot be unified. In recent years, it has been reported that the package illustration has no statistically significant brand equity improvement effect on consumers (Jaung et al. 2019).

Samples lacking one or more answers to the questions and those with option 3 selected for Question 8 were classified as protest responses. There were 109 protest responses, which were excluded from the analysis (exclusion rate = 109/917 or ~ 12%). Lo and Jim (2015) showed that WTP might be inappropriate when the rate of sample removal exceeds 50%, and an alternative method should be used. However, our exclusion rate is lower than this threshold.

Approximately 75% of the respondents were less than 49 years old and ~ 90% were female. The distributions based on the type of sense of public benefit (TSPB) determined using Questions 5 and 6 are shown immediately below the row containing Q6.

Table 2 presents the cross-tabulation of the answers to the questions used when calculating the WTP. As shown in Fig. 2, four different patterns were presented for each questionnaire, and the respondents were asked to choose one. Therefore, when summarizing the answers for this part out of the collected 832 samples, the theoretical maximum was 3328. A total of 808 respondents answered all four parts; therefore, the total number of selections was 3232 (808 × 4). In addition, “Yes” means that JPVs produced by the K-settlement were selected, whereas “No” means that competing goods were selected.

Analysis and discussion

Estimation of WTP

The presented price’s acceptance rate (P) was estimated using a log-linear logit model such as the one shown in Eq. (1). The results were estimated based on 3232 selections. The WTP was estimated as shown in Table 3, and the parameters of the model equation were identified.

Table 3 Parameter estimation of function representing acceptance rate (P) for presented price

For WTP estimation, the linear log-logit model was used, as described in Eq. (1):

$$ P = {1 \mathord{\left/ {\vphantom {1 {\left\langle {1 + \exp \left\{ { - \left[ {\alpha + \beta \times \ln \left( {{\text{bit}}} \right)} \right]} \right\}} \right\rangle }}} \right. \kern-\nulldelimiterspace} {\left\langle {1 + \exp \left\{ { - \left[ {\alpha + \beta \times \ln \left( {{\text{bit}}} \right)} \right]} \right\}} \right\rangle }}, $$
(1)

where bit is the presented price, and α and β are parameters of the function.

The results of the analysis are presented, as follows: The median of the WTP was ¥279, the average value with a cut-off at the maximum presented price was ¥292, and a price premium of ~ 40% was evaluated compared with that of the comparative product, which was assumed to be ¥200 (Table 3). The acceptance probability curve for the presented prices is shown in Fig. 4. The results showed that the strategy of the K-project is likely to be successful because a price premium can be expected from consumers.

Fig. 4
figure4

Acceptance probability curve for presented prices

Furthermore, by exploring the factors that contribute to decision-making and purchasing behavior, it is possible to determine the attributes of consumers that are expected to contribute to the conservation of the natural environment indirectly. The following section considers the influence of TSPB on purchasing behavior, which is the focus of this study, and the importance of improving public awareness on the conservation of natural resources based on the results obtained.

Factors affecting WTP

The factors contributing to the acceptance of the proposed amounts were identified using the responses to Q1–Q7 in Table 1 and the product attributes of the planned items as explanatory variables (Table 4). The aim was to determine whether the TSPB calculated from Q6 affected the acceptance probability. If some explanatory variables are significant, the TSPB can be used to encourage citizens to contribute to the conservation of the natural environment by strengthening actions that do not require substantial amounts of additional investment, such as environmental education. However, if not, the conservation of the natural environment and the awareness of the related public benefits are unrelated. In this case, the results of the statistical analysis did not indicate the effect of stimulating public value recognition for ecosystem services to promote participation in voluntary environmental conservation activities. That is, our results cannot support the hypothesis of this research and suggest that a certain degree of public funding is essential for the conservation of natural resources and communities in rural areas.

Table 4 Variables used to estimate influential factors and correlation with willingness to pay

The evaluation of determinants derived from the full model analysis is shown in Table 4. The contribution of individual factors is interpreted as follows: The acceptance probability of the proposed price increases as the age range (generation; X1) increases, and if the gender (X2) is female. By comparing these coefficients, we found that gender has a significant effect on the responses. Furthermore, the probability of acceptance of the proposed price is high when consumers have participated in conservation activities related to the natural environment (X3) and if they have a strong interest in the natural environment (X4). Similarly, by comparing these coefficients, we found that the presence or absence of such interest greatly influences the responses. However, the influence of establishing a farmer’s market that reused idle facilities as a place to sell products and the sale of additive-free JPVs was not significant. In other words, the strategy of the K-project is not necessarily effective with respect to these two factors. In addition, the results suggest that the target audience should include older women with interest in environmental conservation activities. This finding is essential for the success of the K-project.

The influence of TSPB (X5) on the probability of acceptance was also analyzed, but it was not significantly affecting the probability of acceptance. However, people who can identify the difference between welfare due to the convenience of urban functions and welfare due to ecosystem services (X7) report a higher probability of acceptance. In other words, understanding this difference can encourage consumption as an indirect action leading to the conservation of ecosystem services. Therefore, the argument that it is possible to promote voluntary conservation behavior via environmental education that informs people about the public benefit of ecosystem services is case-specific.

The limitations of this study include the feasibility of the K-settlement plan. Although CVM can quantitatively assess the cognition of urban fringe-area residents to ecosystem services and evaluate the feasibility of the plan, the feasibility of the plan may have been reduced to a certain extent because population decline has already progressed in this mountainous area. This suggests that WTP estimated from urban residents’ opinions in this area may not be appropriate for other rural communities. It is essential to attribute the analytical results to the K-settlement and encourage revision and implementation of the plan for use in other areas. In addition, statistical analysis results suggest that the influence of age and gender bias of respondents is substantial, making it necessary to consider this influence on the interpretation of the results.

Conclusion

This study tested the hypothesis that the consumption of agricultural and processed products originating from Satoyama would rise when the ecosystem service in the Satoyama is perceived as a public-benefit value promoted to suburban residents. The effect of various factors, such as individual attributes and experience, with the natural environment on consumption behavior were also examined.

The results of this study can be briefly summarized as follows: first, many citizens living in urban areas have recognized the value of the natural environment and intend to purchase unique products produced in such areas to support the local conservation of the environment. In addition, based on the estimated WTP for unique products in such areas, an additional price premium of ~ 40% for such goods was confirmed compared with that of general commodities. Furthermore, the statistical analysis results showed that the WTP fluctuates slightly depending on gender and prior experience with the natural environment. The natural environment and the traditional culture in rural areas are recognized to offer certain benefits for citizens residing near urban areas. However, the relationship between a citizen’s awareness of ecosystem services as a public benefit and their participation in conservation activities is not supported by the results of this study.

The finding that the majority of citizens consider ecosystem services as offering public benefit is appropriate in the original sense of ecosystem services that a wide range of people can enjoy. However, the analysis of consumer behavior suggests that the effect of fostering indirect involvement in the conservation of Satoyama through the consumption of agricultural products is extremely limited for promoting the recognition of ecosystem services in Satoyama as a public-benefit value. That is, niche marketing focusing on specific age groups and other key factors can be effective but may not be expected to have an disproportionate effect on the consumption of agricultural products in response to learning about ecosystem services through environmental education promoted by the national government, local governments, and schools. Instead, expanding awareness of the public-interest value of ecosystem services in Satoyama should be linked to the direct conservation of the natural environment through inclusive labor and exchange activities. The empirical results of this research are beneficial for areas focusing on revitalization by promoting the proper utilization of environmental resources because developing projects in such areas without appropriate objectives or strategies is a waste of labor and funding.

In this study, though the universality of the conclusion was not discussed, placing priority on the uniqueness of the study area, a regional activation using natural resources is planned in the depopulated area in each place as well as the study area. A meta-analysis to cross-sectionally compare the results of multi-case analyses may offer a more universal understanding of the status quo and differences and may contribute to support policies for national depopulated areas. Such a future meta-analysis is desirable.

Data availability

The datasets generated during this study are not publicly available but are available on reasonable request.

Notes

  1. 1.

    The definition and significance of CSV are explained in detail in Porter and Kramer (2011).

  2. 2.

    Nowadays, in Japan, there are some temporal subsidies for the planning and practice of these activities.

  3. 3.

    A previous report (Yamashita 2013) did not consider an analysis index; the concept of viewing public benefit is specific to this study.

  4. 4.

    I had in-depth discussions with schoolteachers and administrative staff who regularly exchange opinions with the subjects of this survey and examined the subjects’ reading skills in advance. Based on that, I prepared a questionnaire with simple sentences so that respondents could understand it easily.

  5. 5.

    The monthly average price of the US dollar against the Japanese yen (¥) in January 2013 was ¥89.02/ $. Therefore, ¥200 corresponds to about $2.25.

  6. 6.

    As shown in Table 4, these four patterns are based on a combination of data from two places of sales and the presence or absence of additives (2 × 2).

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Funding

This study was funded by JSPS KAKENHI (Grant Numbers 15H05630, 18H03447, 24780222).

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Correspondence to Ryohei Yamashita.

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There is no conflict of interest.

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This article does not contain any physical studies with human participants performed by author.

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Yamashita, R. Nexus of the awareness of ecosystem services as a “public-benefit value” and “utility value for consumption”: an economic evaluation of the agricultural culture of Satoyama in Japan. SN Bus Econ 1, 133 (2021). https://doi.org/10.1007/s43546-021-00135-9

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Keywords

  • Consumer behavior
  • Contingent valuation method
  • Ecosystem service
  • Public-benefit value