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An Evaluation of Economic and Non-economic Techniques for Assessing the Importance of Biodiversity and associated

Ecosystem Services to People in Developing Countries.

EnvEcon conference(20 March 2009)

Dr Mike Christie

Overview• Background to study• Research aims• Method• Results: from systemised review• Results: methodological, practical and policy issues• Conclusions and recommendations

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Background• Biodiversity supports a range of ecosystem services that are

of fundamental importance to people, for health, well-being, livelihoods, and survival (MA, 2005).

• People from the poorest nations tend to have the greatest immediate dependency on these ecosystem services.

• Gaining a better understanding of the role of biodiversity is fundamental for securing the livelihoods and well-being of people in developing countries.

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Aims and objectives• Aims:

– To evaluate economic and non-economic techniques for assessing the importance of biodiversity to people in developing countries.

• Objectives:– assess the ability of a range of techniques to:

(i) reveal the complex relationship between people and their natural environment;

(ii) identify meaningful preference revelation; and (iii) produce results that are meaningful to policy-making.

– use case studies to illustrate the difficulties, issues and solutions encountered and delivered by the techniques examined;

– identify ways in which people use and think about the natural environment in the contexts being examined.

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Research method• A systemised search of:

– Environmental Valuation Research Inventory (EVRI);– Web of Knowledge.

• A survey of researchers and policy makers.

• Five in-depth case studies to examine methodological and practical problems experience when applying techniques in developing countries:– Southern Africa, – Montserrat, – Uganda, – Solomon Island, – Agatti Islands, India.

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Methods reviewed

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Economic techniques Non-economic techniquesMarket price approaches

Market cost approaches

Replacement costs approaches

Damage cost avoided approaches

Production function approaches

Revealed preference methods

Travel cost method

Hedonic pricing method

Stated preference methods

Choice modelling

Contingent valuation

Participatory approaches to valuation

Deliberative valuation

Mediated modelling

Benefits transfer

Consultative methods:

Questionnaires

In-depth interviews

Deliberative and participatory approaches:

Focus groups, in-depth groups

Citizen juries

Health-based valuation approaches

Q-methodology

Delphi surveys

Rapid rural appraisal

Participatory rural appraisal

Participatory action research

Methods for reviewing information:

Systematic reviews

Results of the review

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• No. of studies that valued biodiversity in developing countries:– EVRI:

• 195 economic studies

– Web of Knowledge: • 183 economic studies • 101 non-economic studies.

• Developing country studies represent 1/10th of all published biodiversity valuation studies.

1960-1964 1965-1969 1970-1974 1975-1979 1980-1984 1985-1989 1990-1994 1995-1999 2000-2004 2005-2008

0

200

400

600

800

1000

1200

1400

HIGH INCOME

UPPER MIDDLE INCOME

LOWER MIDDLE INCOME

LOWER INCOME

TRANS-ITIONAL INCOME

YEARS

NU

MB

ER

OF

PA

PE

RS

Cumulative total of biodiversity valuation studies

sourced from EVRI for all National Income States from

1960- 2008.

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Geographic distribution of papers

0

10

20

30

40

50

60

AFRICA ASIA EUROPE NORTH AMERICA SOUTH AMERICA REGION

% OF PAPERS SOURCED

LOWER MIDDLE INCOME LOWER INCOME

TRANSITIONAL

Method used in biodiversity studies

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Producti

on Functi

on

Opportunity

Cost

Damage Cost

Replacement C

osts

Trave

l Cost

Method

Hedonic Pric

e Method

Contingent Valuation

Choice Exp

eriment

Delibera

tive Valuation

Benefits Tra

nsfer

Questionnaire

s

In-Depth In

terview

Focu

s Gro

ups

Health Base

d Approach

es

Q-Methodology

Rapid Rural A

ppraisa

l

Particip

atory Rura

l Appra

isal

Particip

atory Acti

on Research

0

10

20

30

40

50

60

70

80

No.

of p

aper

s

Authors from a developing country

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All authors First author Any author None0

20

40

60

80

100

120

140

160

28 %

32 %

48 % 48 %

Num

ber o

f pap

ers

Results: Methodological, practical and policy issues

Based on expert survey and case studies.

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Methodological issues• Low levels of literacy, education and language

– Creates barriers to valuing complex environmental goods– Makes it difficult to utilise traditional survey techniques such as

questionnaires and interviews. – More deliberative and participatory approaches to data collection may

overcome these issues.

• Informal or subsistence economies – People may have little or no experience of dealing with money. – People find it difficult to place a monetary value on complex and

unfamiliar environmental goods / services.

• Valuation methods have been developed in developed countries– Are the current best-practice guidelines appropriate for applications in

developing countries? 13

Practical issues• Extreme environmental conditions

– Affect the researcher’s ability to access areas or effectively undertake research.

• Lack of local research capacity to design, administer and analyse research projects– Involvement of local people is considered essential within the research process to

ensure that local nuances / values are accounted for.

• Sometimes easier to administer valuation studies in developing countries– Response rates are typically higher– Respondents are receptive to listening and considering questions posed– Interviewers are relatively inexpensive (allowing larger sample sizes).

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Policy issues• Lack of local research capacity

– Lack of awareness of valuation methods and of the importance of biodiversity to people.

• Lack of empirical valuation studies in developing countries– Little evidence to illustrate the importance of biodiversity to people.– Makes future benefits transfer difficult.

• Existing research is often extractive– Often little engagement with local communities, researchers or decision

makers. – Research therefore has very little impact on the welfare of local people.

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Conclusions• The way people in developing countries think about the natural

environment is different to those in developed countries. – They have much closer ties to their natural environment. – Their knowledge is often implicit and / or experiential knowledge– Low levels of literacy and education mean that most people will have little or

no scientific understanding of their natural environment. – The above means that people from developing countries may have difficulty

in expressing their value for natural resources.

• Given the above, standard approaches to valuation are unlikely to effectively reveal the preferences of people in developing countries.

• Valuation may be more effective if: – Local researchers are used throughout the research process– Deliberative, participative and action research approaches are incorporated

into the valuation methods. 16

Recommendations• Further research is required:

– To develop best-practice guidelines for valuation research in a developing country context.

– To explore ways in which deliberative, participatory and action research approaches might best be incorporated into economic valuation.

– To build local research capacity to allow local researchers to be utilised at all stages in the design, administration and analysis of valuation studies.

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The research team would like to thank Defra for funding this research project.

Copies of the full report can be found at: http://users.aber.ac.uk/mec/index.htm

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