Attitudes Towards And Willingness To Pay For Different Treatments Of Mountain Forests: an empirical study of forests in Hikrjølen, Norway

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Master of Science Thesis. Agricultural University of Norway, Department of Forestry, Section of Resource Economics and Planning. 86 p. Address: PO Box 44, 1432 Ås-NLH, Norway.

by Knut Simensen and Michiel H. A. Wind

Nederlandstalige samenvatting of complete document in het Noors op verzoek aan te vragen.

ABSTRACT

Attitudes toward and willingness to pay for different treatments of mountain forests in the area of Hirkjolen, Norway were investigated. Answers to the following questions were sought:

1. What are the attitudes of the public users of mountain forest areas to various treatments of such areas? What factors determine these attitudes?
2. How much is the public willing to pay for various treatments of mountain forests?
3. ow suitable is the contingent valuation method (CVM) for valuing multiple uses of mountain forests?

CVM involves use of a questionnaire to obtain willingness to pay (WTP) information which in turn can be used for valuation of public goods. Using personal interviews, different forest treatments were described to respondents; their attitudes and personal opinions about such treatments were determined. The respondents were then asked how much they would be willing to pay for each treatment in a hypothetical market situation. 57% of the respondents indicated 'selection forestry' (i.e. harvesting timber through selective thinning) was the best treatment from society's point of view. From a tourism point of view, however, 57% thought a virgin, untouched forest was best. The primary objections to clearcutting were forest debris and stumps, destruction of natural areas, and damage to wildlife. About half the respondents found construction of forest roads to be negative; a quarter indicated they were positive.

Willingness to pay for three different forest treatments was determined with the aid of photographs (each treatment was described by four different photos). Respondents were asked to value the treatments on a scale of one to ten (ten being best). They were then asked how much they would be willing to pay for the two treatments they preferred (the worst treatment was considered to be free). To facilitate determination of their WTP, the motor tourists and cottage tourists were asked to imagine paying a toll before entering the forest area. Hikers were asked to imagine paying a parking fee at the foot of the mountains or an extra fee for public transportation (e.g. bus).

Hikers indicated the highest WTP (expressed as median [mean in parenthesis] Norwegian crowns [NOK] per visit), namely 45 NOK (73) for selection forestry treatments, and 60 NOK (96) for virgin forest. Motor tourists would pay 30 NOK (35) for selection forest treatments, while cottage tourists would pay 25 NOK for either treatment. It should be noted that the mean figures are severely influenced by the extreme responses of a few respondents. The annual WTP for all types of respondents (motor tourists, cottage tourists, hikers) is estimated at 3,278,000 NOK for selection forestry treatments and 4,423,000 NOK for virgin forest. Because of a possible upward bias in these amounts, they were reduced to 1,427,000 NOK and 1,818,000 NOK, respectively. The largest source of bias was probably amenity misspecification bias which occured when respondents failed to correctly value the forest treatments even though they intended to do so. In addition, there probably occurred mental account bias wherein respondents spent too much of their total WTP budget for the various forestry treatments. If they had been aware of other opportunities for their limited WTP, they might not have (could not have) paid as much for the forest treatments as they did.

Questionnaire design is very important when using CVM. If biases from innapropraite questionnaire design are found to be occurring, the questionnaire should be redesigned, or tests should carried out to determine the size of the biases which then can be compensated for in the analysis.

The mountain forest user's WTP for selection forest treatment and virgin forest in the mountain forests studied here is considerably larger than the economic yield that would result from clearcutting of the same forests. When considering selection forest and virgin forest treatments, managers should consider the WTP estimates for each treatment; the treatment with the largest WTP should be selected. Uncertainty and the lack of values from other users and nonusers of the forest area should also be considered when making such decisions. This investigation has shown, however, that there is considerable social economic benefit if clearcut forest treatments are avoided in the mountain forests investigated here.

May 1990.