ALTERNATIVE NUMERAIRES FOR MEASURING WELFARE CHANGES: REVIEW OF EMPIRICAL ENVIRONMENTAL VALUATION STUDIES
DOI:
https://doi.org/10.21837/pm.v19i17.995Keywords:
numeraire, welfare change, willingness to work, willingness to payAbstract
This study examines numeraire or an account unit that measures household welfare changes. Although money metric usually determines budget constraint, textbook explanations of the alternative metrics are limited. Therefore, the study aimed to fill the existing gap by systematically and qualitatively analysing previously published articles on environmental valuation in developing countries. The results showed the existence of alternative numeraires in working time, commodities, and financing. The alternative metrics are useful in the valuation of environmental goods and services in developing countries, especially those involving poor respondents and underdeveloped monetary transactions. The nonmonetary payments reduce zero bids due to the inability of subsistence people to pay in cash and help the poor express their true environmental values.Downloads
References
Abramson, A., Becker, N., Garb, Y., & Lazarovitch, N. (2011). Willingness to pay, borrow and work for rural water service improvements in developing countries. Water Resources Research, 47, W11512.
Ahlheim, M., Fror, O., Heinke, A., Duc, N. M., & Dinh, P. V. (2010). Labour as a utility measure in contingent valuation studies: How good is it really? FZID Discussion Paper No. 13-2010. Stuttgart, Germany: Center for Research on Innovation and Services, University of Hohenheim.
Alam, K. (2013). Factors affecting public participation in river ecosystem restoration: Using the contingent valuation method. The Journal of Developing Areas, 47(1), 223-240.
Arbiol, J., Borja, M., Yabe, M., Nomura, H., Gloriani, N. & Yoshida, S. (2013). Valuing human leptospirosis prevention using the opportunity cost of labor. International Journal of Environmental Research and Public Health, 10, 1845-1860.
Brouwer, R., Akter, S., Brander, L., & Haque, E. (2008). Economic valuation of flood risk exposure and reduction in a severely flood-prone developing country. Environment and Development Economics, 14, 397-417.
Carson, R. T. & Louviere, J. L. (2011). A common nomenclature for stated preference elicitation approaches. Environmental and Resource Economics, 49(4), 539-559.
Casiwan-Launio, C., Shinbo, T., & Morooka, Y. (2011). Island villagers' willingness to pay for the sustainability of a marine fishery reserve: Case of San Miguel Island, Philippines. Coastal Management, 39, 459-477.
Dai, H., Lee, C., Cheng, K. & Zong, C. (2017). Community residents’ willingness to contribute to wetland ecosystem services in Sanjiang Plain Natural Reserves. Journal of Natural Resources, 32(6), 977-987.
Das, D. & Mahanta, R. (2013). Willingness to spend labor hour for biodiversity conservation: A case study with special reference to village forest dwellers and encroachers in Assam. Journal of Biodiversity, 4(1), 45-51.
Diafas, I., Barkmann, J. & Mburu, J. (2017). Measurement of bequest value using a nonmonetary payment in a choice experiment- The case of improving forest ecosystem services for the benefit of local communities in rural Kenya. Ecological Economics, 140, 157-165.
Eom, Y-S. & Larson, D. M. (2006). Valuing housework time from the willingness to spend time and money for environmental quality improvements. Review of Economics of the Households, 4, 205-227.
Gibson, J. M., Rigby, D., Polya, D. A. & Russell, N. (2016). Discrete choice experiment in developing countries: Willingness to pay versus willingness to work. Environmental and Resource Economics, 65, 697-721.
Girma, W. & Beyene, F. (2012). Willingness to contribute to collective forest management: Evidence from Godere in the Gambela Region of Ethiopia. The Journal of Socio-Economics, 41, 79-86.
Gorkhali, S. P. (2009). Economic Analysis of Infrastructure Investments: National Benefits and Local Costs- Case Study of a Hydropower Project in Nepal. Gottingen, Germany: Cuvillier Verlag.
Haab, T. C. & McConnell, K. E. (2002). Valuing Environmental and Natural Resources: The Econometrics of Nonmarket Valuation. Cheltenham, UK & Northampton, MA, USA: Edward Elgar.
Hagedoorn, L. C., Koetse, M. J., van Beukering, P. J. H. & Brander, L. M. (2020). Time equals money? Valuing ecosystem-based adaptation in a developing country context. Environment and Development Economics, 25, 482-508.
Hassan, S., Olsen, S. B. & Thorsen, B. J. (2018). Appropriate payment vehicles in stated preference studies in developing economies. Environmental Resource Economics, 71, 1053-1075.
Hung, L. T., Loomis, J. B., & Thinh, V. T. (2007). Comparing money and labor payment in contingent valuation: The case of forest fire prevention in the Vietnamese context. Journal of International Development, 19, 173-185.
Ishiguro, K. (2019). Evaluation of forest preservation in Cambodian rural villages. Journal of Sustainable Development, 12(1), 27-38.
Jiang, X. (2018). Analyzing the willingness to work and willingness to pay for RWH in Japan. Jurnal Lanskap Indonesia, 10(2), 3-45.
Kassahun, H. T., Jacobsen, J. B. & Nicholson, C. F. (2020). Revisiting chut and land labor for valuing environmental goods and services in developing countries. Ecological Economics, 177, 106771.
Latip, N. A., Badarulzaman, N., Marzuki, A., & Umar, M. U. (2013). Sustainable forest management in Lower Kinabatangan, Sabah: Issues and current practices. Planning Malaysia, 11, 59-84.
Nath, T. K., Bin Dahalan, M. P., Parish, F., & Rengasamy, N. (2017). Local peoples’ appreciation on and contribution to the conservation of peatland swamp forests: Experience from Peninsular Malaysia. Wetlands, 37, 1067-1077.
Ninan, K. N. & Sathyapalan, J. (2005). The economics of biodiversity conservation: A study of the coffee-growing region in the Western Ghats of India. Ecological Economics, 55, 61-72.
Notaro, S. & Paletto, A. (2011). Links between mountain communities and environmental services in the Italian Alps. Sociologia Ruralis, 51(2), 137-157.
Navrud, S. & Vondolia, G. K. (2020). Farmers’ preferences for reductions in flood risk under monetary and non-monetary payment modes. Water Resources and Economics, 30, 100151.
O’Garra, T. (2009). Bequest values for marine resources: How important for indigenous communities in less-developed economies? Environmental and Resource Economics, 44, 179-202.
Pondorfer, A. & Rehdanz, K. (2018). Eliciting preferences for public goods in nonmonetized communities: Accounting for preference uncertainty. Land Economics, 94(1), 73-86.
Rai, R. K. & Scarborough, H. (2015). Nonmarket valuation in developing countries: Incorporating labor contributions in environmental benefits estimates. Australian Journal of Agricultural and Resource Economics, 59, 479-498.
Saizan, S., Sukeri, S., Zahiruddin, W. M., Shafei, M. N., Rukman, A. H., Malina, O., Jamaluddin, T. Z. M. T., & Aziah, D. (2019). Economic benefit of leptospirosis prevention in Kelatan, Malaysia: Willingness-to-contribute approach. International Journal of Health Planning Management, 34, e817-e823.
Saxena, A. K., Bisht, N. S., & Singh, C. J. (2008). The value of the Indian gazelle (Gazella gazelle): A case study in Haryana, India. The Indian Forester, 134(10), 12891295.
Schiappacasse, I., Vasquez, F., Nahuelhual, L., & Echeverria, C. (2013). Labor as a welfare measure in contingent valuation: The value of a forest restoration project. Ciencia e Investigacion Agraria, 40(1), 69-84.
Soderqvist, T. & Soutukorva, A. (2009). On how to assess the quality of environmental valuation studies. Journal of Forest Economics, 15, 15-36.
Solikin, A. (2017). Willingness to pay and willingness to work to avoid deforestation and forest degradation. In Taufik, T. et al. (Eds.). ICoSI 2014: Proceeding of the 2nd International Conference on Sustainable Innovation. Singapore: Springer Nature.
Solikin, A., Abdul Rahman, R., Saefrudin, E, Suboh, N., Zahari, N. A. & Wahyudi, E. (2019). Using travel cost method (TCM) to value forests: Cases of Pahang National Park and Srengseng Jakarta Urban Forests. Planning Malaysia, 17(1), 365-376.
Sunoto, Y. N., Fatiah, A. A., Ponrahono, Z., & Osman, M. M. (2020). Profiling the perceived mangrove forest use-value and community’s willingness to pay for mangrove conservation. Planning Malaysia, 18(3), 229-240.
Susilo, H., Takahashi, Y., & Yabe, M. (2017). The opportunity cost of labor for valuing mangrove restoration in Mahakam Delta, Indonesia. Sustainability, 9, 2169.
Tilahun, M., Vranken, L., Muys, B., Deckers, J., Gebregziabher, K., Gebrehiwot, K., Bauer, H., & Mathijs, E. (2015). Rural households’ demand for frankincense forest conservation in Tigray, Ethiopia: A contingent valuation analysis. Land Degradation and Development, 26, 642-653.
van Houtven, G. L., Pattanayak, S. K., Usmani, F., & Yang, J.-C. (2017). What are households' willingness to pay for improved water access? Results from a metaanalysis. Ecological Economics, 136, 126-135.
Varian, H. A. (2010). Intermediate Microeconomics: A Modern Approach, 8th Ed. New York: W.W. Norton.
Vasquez, W. F. (2014). Willingness to pay and willingness to work for improvements of municipal and community-managed water services. Water Resources Research, 50, 8002-8014.
Vondolia, G. K., Eggert, H., Navrud, S., & Stage, J. (2014). What do respondents bring to contingent valuation? A comparison of monetary and labor payment vehicles. Journal of Environmental Economics and Policy, 3(3), 253-267.
Whittington, D. (2010). What have we learned from 20 years of stated preference research in less-developed countries? Annual Review of Resource Economics, 2, 209-236.
Downloads
Published
How to Cite
Issue
Section
License
Copyright & Creative Commons Licence
eISSN: 0128-0945 © Year. The Authors. Published for Malaysia Institute of Planners. This is an open-access article under the CC BY-NC-ND license.
The authors hold the copyright without restrictions and also retain publishing rights without restrictions.
