Willingness of Sri Lankan farmers to pay for a scheme to conserve elephants: An empirical analysis

This paper explores the feasibility of adopting an integrated economic approach to raise farmers’ tolerance of the presence of elephants on their farming lands. Responses to this approach were sought from a sample of farmers in the areas affected by human elephant conflict in the northwestern province of Sri Lanka. Results from a contingent valuation survey of their willingness to pay for a scheme to conserve elephants are also reported. Two separate logit regression analyses were undertaken to examine the factors that influence the farmers’ responses for the payment principle question and their opinions on the integrated economic approach. Although found that the majority of the respondents expressed their willingness to pay for the proposed scheme and supported for the implementation of the integrated approach, we have insufficient data yet to determine if their support and financial contribution would be sufficient to set up this programme and also to predict its economic viability. Nevertheless, the overall finding of this study provides an improved economic assessment of the farmers’ attitudes towards the wild elephant in Sri Lanka. At the same time the study shows that, contrary to commonly held assumptions, farmers in this developing country, do support wildlife conservation.

Ecotourism/Wildlife-based tourism as contributor to nature conservation with reference to Vanni, Sri Lanka

After discussing definitions of ecotourism, outlines possible economic and conservational benefits from developing ecotourism or wildlife-based tourism. Identifies possible economic benefits for local communities but also outlines possible economic costs to such communities. Observations are made on the potential of developing ecotourism in the Giant’s Tank/Mannar area. A sufficient market does not always exist for wildlife-based tourism to make it economically viable. Therefore, market analysis should be undertaken before promoting the development of wildlife-based tourism in a locality. A checklist is provided to give some guidance in market appraisal. It is observed that even non-consumptive wildlife-based tourism can have adverse environmental consequences and these are listed. Care is needed to avoid these negative consequences and to ensure that local communities do in fact obtain adequate economic benefits from the development of wildlife-based tourism.

Wildlife damage, insurance/compensation for farmers and conservation: Sri Lankan elephants as a case

The interference with agriculture has been recognised as the main cause for the current conflict between farmers and wild elephants in Sri Lanka, as elsewhere in the Asian elephant range. Thus compensating farmers for the damages caused by elephants is essential, if this endangered species is to survive in the long run. This paper explores the practicality of establishing an improved publicly funded insurance/compensation scheme to recompense farmers for the elephant damages. It does so by analysing results from two contingent valuation surveys undertaken in Sri Lanka. We find that possible public support of farmers plus urban dwellers significantly exceeds the financial requirement of the insurance scheme proposed in this study for perpetuity. The article also shows that it is often inappropriate from an economic viewpoint to analyse crop insurance as if it only involves the insurance of a private good because important positive externalities can arise from ‘crop’ damages by wildlife, e.g. elephants. The use of agricultural land by some species is essential for their long-term survival and this is often positively valued by the community as a whole.

Attitudes to entry fees to National Parks: Results and policy implications from a Queensland case study

Examines visitor attitudes and whether visitors are willing to pay to enter Lamington National Park and under what circumstances they would do so. First a sample of visitors is asked a general (normative) question as to whether visitors should pay to visit Lamington National Park and in another question (positive) they are asked whether they would be more willing to pay if the money collected would be invested in the park to improve visitor facilities and for conservation work. The results show that visitors are more willing to accept the ‘user-pays’ principle if the money will be used for the benefit of the national park and its visitors. It was found that foreigners are more in support for a ‘user-pay’ fee than Australians, and among Australians, those visitors from Queensland are the least willing to accept the idea of a user-pay fee to enter the park. The results indicate that if visitors can be shown the benefits (both for visitors and for conservation) of charging an entry fee, then visitors are more likely to support such a concept than when they are unaware of the benefits of a user-fee. The study shows that on average foreigners are willing to pay more than Australians. Finally, the regression results identify significant factors influencing visitors’ attitudes and suggested amounts to visit the national park.

Valuation of tourism's natural resources

Discusses the implications of the economic valuation of natural resources used for tourism and relates this valuation to the concept of total economic valuation. It demonstrates how applications of the concept of total economic valuation can be supportive of the conservation of natural resources used for tourism. Techniques for valuing tourism’s natural resources are then outlined and critically evaluated. Consideration is given to travel cost methods, contingent valuation methods, and hedonic pricing approaches before concentrating on current developments of valuation techniques, such as choice modelling. The general limitations of existing methods are considered and it is argued that more attention should be given to developing guidelines that will identify ‘optimally imperfect methods’. An overall assessment concludes this article.

Visitors' reaction to Pinnawala Elephant Orphanage in Sri Lanka

Pinnawala Elephant Orphanage (PEO) is a unique captive elephant-based recreation facility in Sri Lanka. Over 35,000 visitors (both local and foreign) visit the PEO per month on average for a variety of reasons. However, little or no attempt has been made to examine their reaction to its activities. This paper reports preliminary findings from two visitor surveys (one local and one foreign) conducted at the PEO to examine the characteristics of visitors, the satisfaction they gained from the visit, their attitudes towards conservation of the elephant, their reactions to the current facilities available at the orphanage, and their opinions and maximum willingness to pay (WTP) to enter the PEO. It is found that, although some variations occurred between the samples, the majority of all respondents showed a similar reaction to the activities and facilities at the Orphanage. However, some differences are evident between these two samples in relation to satisfaction received, responses to the WTP elicitation and attitudes towards the information and interpretive facilities. Overall, the majority of the respondents indicated that their support for the conservation of the Asian elephant had increased considerably with their visit to the Orphanage. This indicates that considerable unrecorded and as yet unutilised support could be generated both financially and otherwise to conserve this endangered species through wildlife based recreation facilities such as PEO in Sri Lanka.

Property rights of landholders in non-captive wildlife and prospects for conservation

In order to reduce the rate of human-induced biodiversity loss of wild species, it has become increasingly important to stem this loss on private and tribal lands and to find effective policies to do this. Some writers believe that granting landholders commercial property rights in wildlife might be effective in dealing with this matter and result in the sustainable use of wildlife. This paper explores this view using economic theory. In doing so, it takes into account the total economic valuation concept. While granting of commercial property rights is found to be effective for conserving some species, it is predicted to be a complete failure as a means of conserving other species. In addition, particular attention is given to the economics of the utilisation and conservation of non-captive fugitive (or mobile) wildlife. The economic theory involved is contrasted and compared with that for the exploitation of open-access resources.

Willingness to pay for different degrees of abundance of elephants

This paper presents an application of the contingent valuation method (CVM) to determine how the willingness to pay (WTP) for conservation of Asian elephants varies with hypothetical variations in their population. Results from a CVM survey of a sample of urban residents in Colombo, the capital of Sri Lanka are used for this purpose. We find, consistent with the basic principles of consumer demand theory, the marginal change in the respondents’ WTP amounts is positive but appears to diminish in parallel to the increases in the current wild elephant population (CWEP). In contrast to theoretical expectations, however, we find that the WTP for preserving this species increases at an increasing rate in relation to decreases in the CWEP. This is probably because respondents perceive that extinction becomes more imminent as the abundance of the elephant is reduced and therefore it becomes more urgent to act. However, this adds a new complication to the interpretation of the WTP findings.

The net benefit of saving the Asian Elephant: A policy and contingent valuation Study

Reports results from a contingent valuation survey of willingness to pay for the conservation of the Asian elephant of a sample of urban residents living in three selected housing schemes in Colombo, the capital of Sri Lanka. Face–to–face surveys were conducted using an interview schedule. A non-linear logit regression model is used to analyse the respondents’ responses for the payment principle questions and to identify the factors that influence their responses. We investigate whether urban residents’ willingness to pay for the conservation of elephants is sufficient to compensate farmers for the damage caused by elephants. We find that the beneficiaries (the urban residents) could compensate losers (the farmers in the areas affected by human–elephant conflict) and be better off than in the absence of elephants in Sri Lanka. Therefore, there is a strong economic case for the conservation of the wild elephant population in Sri Lanka. However, we have insufficient data to determine the optimal level of this elephant population in the Kaldor-Hicks sense. Nevertheless, the current population of elephant in Sri Lanka is Kaldor-Hicks preferable to having none.

Economics of wildlife tourism

After introducing the importance of the topic, we examine the economic impacts of wildlife tourism on income and employment as an indicator of the importance of this form of tourism. While such indicators can be important politically and to particular interest groups, they are shown to be an inadequate guide to the economic use and conservation of resources, including wildlife used in tourism. One reason for this (amongst others) is that total economic value must be taken into account in determining economic resource use and this is shown to be quite important in the case of wildlife species. Empirical procedures, such as use of the travel cost method and stated preference methods (for example, contingent valuation) are outlined and the way in which they can be used for determining the optimal economic allocation of land and other resources for wildlife tourism is explained. Economic implications and limitations of some empirical estimates of the importance of wildlife tourism are discussed. This leads on to a consideration of the purpose and usefulness of using economic instruments to manage wildlife tourism.

Notes on market failure and the Paretian (Kaldor-Hicks) relevance and irrelevance of unfavourable externalities

The following are notes that have been distributed by me over the last few years to students in Environmental Economics at The University of Queensland. They give particular attention to whether externalities are Pareto or Kaldor-Hicks relevant from a policy point of view. Externalities are Kaldor-Hicks or Pareto irrelevant if no change is possible for which gainers could compensate losers. Both absolute and marginal externalities may be Kaldor-Hicks relevant. Infra-marginal negative externalities are often, but not always, Kaldor-Hicks irrelevant. There are at least two cases where such externalities can be relevant. First, the absolute impact of the negative externality may be so great that the source of the externality should be eliminated. Secondly, if the externality arises from production, its nature may depend on the type of production technique adopted. Although for the technique adopted, an infra-marginal negative externality occurs. That is Paretian irrelevant given that choice of this technique is the only available possibility, alternative techniques may actually be available in practice. Some of these may generate even smaller total external effects and be socially preferable. Both cases are outlined and illustrated in these notes. The analysis reveals the dangers of relying on marginalism for deciding on environmental policy. Total (external) effects are often of great social and economic importance and appropriate social choices cannot be made on the basis of marginalism alone.