Farm households' preference for cash-based compensation versus livelihood-enhancing programs: A choice experiment to inform avian flu compensation policy in Nigeria

In this paper we attempt to bridge the resilience school of thought and incentive compatibility in livestock disease control policies through a pilot choice experiment study conducted on 104 farm households in the Nasarawa state of Nigeria. The aim of this study was to shed light on farm households' valuation of various compensation plan attributes and trade-offs among these attributes. In the experiment presented here, compensation plan was defined broadly to include not just the traditional attributes, such as the number of days it takes to receive the payment, the compensation rate, and the method of payment, but also more diverse interventions, such as training in biosecurity measures and access to bank loans, which are expected to have longer-term impacts on households' livelihood outcomes. We analyzed the data using various discrete choice models, the best-fitting of which was the random parameter (or mixed) logit model with interactions, which enabled us to capture both unobserved and observed heterogeneity in farm households' preferences for the compensation plan attributes. The results reveal that overall, study households preferred compensation plans that made payment in fewer days, provided facilitated credit access, and offered biosecurity training. Households with better-educated heads and those with lower income levels valued compensation plans that provided credit access and biosecurity training the most. These findings are expected to inform the design of efficient, effective, equitable, and targeted compensation policies, which could not only reduce the livestock disease risk but also improve the resilience of poor farm households' livelihoods against future poultry-related or other idiosyncratic shocks.avian flu, choice experiment method, compensation scheme, conditional logit model, livestock disease, random parameter logit model,

The Value of Improved Public Services : An Application of the Choice Experiment Method to Estimate the Value of Improved Wastewater Treatment Infrastructure in India

In this paper we employ a stated preference environmental valuation technique, namely the choice experiment method, to estimate local publics willingness to pay (WTP) for improvements in the capacity and technology of a sewage treatment plant (STP) in Chandernagore municipality, located on the banks of the River Ganga in India. A pilot choice experiment study is administered to 150 randomly selected Chandernagore residents and the data are analysed using the conditional logit model with interactions. The results reveal that residents of this municipality are willing to pay significant amounts in terms of higher monthly municipality taxes to ensure the full capacity of the STP is used for primary treatment and the technology is upgraded to enable secondary treatment. Overall, the results reported in this paper supports increased investments to improve the capacity and technology of STPs to reduce water pollution, and hence environmental and health risks that are currently threatening the sustainability of the economic, cultural and religious values this sacred river generates.choice experiment method, conditional logit model, River Ganga, sewage treatment plant, water quality, water quantity

Valuing the environment in developing countries: Modeling the impact of distrust in public authorities' ability to deliver public services on the citizens' willingness to pay for improved environmental quality

In this paper, we employ the choice experiment method to estimate local citizens' valuation of a public intervention that proposes to improve the quality of an important environmental resource, namely, the Ganges River in India. To elicit citizens' willingness to pay (WTP) higher municipality taxes for an intervention that proposes to improve the quantity and quality of wastewater treated by the local sewage treatment plant (STP), 150 randomly selected citizens of the municipality of Chandernagore, located on the banks of the Ganges River in West Bengal, were interviewed. The findings reveal that almost all (98 percent) of the citizens value the quality of the water and the environment in the Ganges, though a great majority (90 percent) protested the intervention by not choosing the improved STP scenario in at least one of the eight hypothetical markets in which they were asked to participate. When asked their reasons for not preferring the improved scenarios, 92 percent of them stated that they do not trust the authorities to efficiently and effectively manage the funds generated through additional taxes. The protest responses were controlled for with the use of the nested logit model (NLM). The results reveal that the citizens are willing to pay significant amounts to ensure that the intervention takes place and that an improved STP treats larger amounts of wastewater to a higher quality before discharging it to the Ganges. Therefore, to improve the wastewater management services and the related environmental quality in the water bodies into which treated wastewater is deposited, the municipalities could rely—at least to some extent—on their citizens' WTP higher taxes for provision of improved services. To capture this WTP, however, municipalities' performance, trustworthiness, and accountability, as well as the citizens' perceptions of these, should be improved.choice experiment method, nested logit model, willingness to pay, sewage treatment plant, distrust in public authorities,

Assessing the economic viability of alternative water resources in water-scarce regions: Combining economic valuation, cost-benefit analysis and discounting

Aquifer recharge, Treated wastewater, Total economic value, Choice experiment, Long-run cost benefit analysis, Declining discounting,

Combining revealed and stated preference methods to assess the private value of agrobiodiversity in Hungarian home gardens:

" Hungarian home gardens are small-scale farms managed by farm households using traditional management practices and family labor. They generate private benefits for farmers by enhancing diet quality and providing food when costs of transacting in local markets are high. Home gardens also generate public benefits for society by supporting long-term productivity advances in agriculture. In this paper, we estimate the private value to farmers of agrobiodiversity in home gardens. Building on the approach presented in EPTD Discussion Paper 117 (2004), we combine a stated preference approach (a choice experiment model) and a revealed preference approach (a discrete-choice, farm household model). Both models are based on random utility theory. To combine the models, primary data were collected from the same 239 farm households in three regions of Hungary. Combining approaches leads to a more efficient and robust estimation of the private value of agrobiodiversity in home gardens. Findings can be used to identify those farming communities, which would benefit most from agri-environmental schemes that support agrobiodiversity maintenance, at least public cost." Authors' abstractHome gardens, Small-scale farmers, Diet quality, Agricultural productivity, Agrobiodiversity, Household surveys, Private value, Choice experiment model, Farm household model, Revealed and stated preference methods,

How safe is my food?: Assessing the effect of information and credible certification on consumer demand for food safety in developing countries

The literature regarding consumer demand for safer food in developing countries is scant, and the general assumption is that these consumers' willingness to pay (WTP, as an indicator of their demand) is constrained by their low ability to pay (ATP). There are, however, a number of developing countries with growing middle-income populations whose ATP has been steadily increasing, although low food safety standards in these countries still prevail. In this paper, we argue that ATP, while necessary, is not the sole condition for WTP and that credible information about and certification of food safety are required to ensure that ATP translates into WTP. To test this hypothesis, we conducted a randomized market experiment in two branches of a supermarket chain in Mumbai, India, a city that hosts one of the world's fastest growing middle-income populations. In this experiment, we sold grapes with credible food safety certification labels and the exact same grapes (a placebo) without such labels. We provided all consumers with extensive food safety information comprising banners and posters announcing the sale of food-safety-certified grapes in the supermarket. We also randomly selected one-half of the consumers and provided them with intensive information (a short documentation flier) describing what credible certification of food safety entails. By continuously varying the prices (with the labeled grapes priced higher than unlabeled ones) during the month in which the experiment was implemented, we found that those consumers who received intensive information (the treatment group) are more likely to purchase grapes labeled as certified. This result is robust to the inclusion of an extensive set of controls (income, gender, and education) gathered through a structured survey instrument implemented following the purchase of the grapes. To further investigate the marginal impact of credible information on consumer demand for food safety, we studied consumers' answers to various knowledge, attitude, perception, and practice (KAPP) questions also collected through the survey instrument. Using KAPP responses, we created a consumer-specific food safety consciousness index (FSCI) and stratified consumers according to those below and those above the sample mean FSCI. We find that the marginal impact of credible information and certification on the purchase of labeled grapes is significantly greater for consumers with higher FSCI. We therefore conclude that credible information and certification are important determinants of consumer demand for food safety.attitude and perceptions, certification, credible information, factor analysis, Food safety, Knowledge, randomized market experiment, willingness to pay,

Agri-environmental policies in a transitional economy: the value of agricultural biodiversity in Hungarian home gardens

"Agricultural biodiversity is an environmental resource. Much of the agricultural biodiversity remaining in situ today is found on the semi-subsistence farms of poorer countries and the small-scale farms or home gardens of more industrialized nations. The traditional small farms of Hungary are labelled “home gardens” as a reflection of their institutional identity during the collectivisation period. Homesteads managed with family labor, they continue to serve essential food security and diet quality functions during economic transition. Home gardens contribute to the preservation of rural settlements and cultural heritage, and they contain relatively high levels of several components of agricultural biodiversity. The role of home gardens in the agri-environmental program that is now being formulated by Hungary and the European Union has not been elucidated, though the stated goal of these policies is to support multifunctional agriculture. This study estimates the private value that Hungarian farmers assign to home gardens and their biodiversity attributes, and indicates how such information might be used in designing least-cost mechanisms to support their maintenance as part of the national agri-environmental program." Authors' AbstractAgricultural biodiversity, In situ conservation,

Agri-Environmental Policies in a Transition Economy: Using a Choice Experiment to Value Agricultural Biodiversity on Hungarian Small Farms

Agricultural biodiversity is a crucial environmental resource. Much of the agricultural biodiversity remaining today is found on the semi-subsistence farms of poorer countries and on the small-scale farms and home gardens of more industrialised nations. The traditional Hungarian home gardens, which serve as small farms, are an example. Historically, these home gardens have served important functions related to food security, diet quality, and local culture. Some policies related to European Union accession threaten the survival of traditional home gardens in Hungary’s transitional economy. This paper applies the choice experiment method to estimate the value farmers themselves attach to the agricultural biodiversity still found in these micro-agroecosystems. One of several related studies, its aim is to enhance policy understanding of the role of Hungarian small farms and home gardens in the National Agri-Environmental Programme. The analysis is based on primary data collected in three environmentally sensitive areas of Hungary where pilot agri-environmental programmes have been initiated. Findings demonstrate the variation in values farmers assign to home gardens across regions and households, with implications for the design of efficient public conservation programmes.Agricultural biodiversity, Conservation, Choice experiment method, Hungary, Home garden

Efficacy and adoption of strategies for avian flu control in developing countries

In this paper, we present the results of a two-stage expert elicitation (Delphi) study conducted to provide input to contingent valuation (CV) studies. These CV studies are designed to estimate the benefits of various public and private strategies for the control of Highly Pathogenic Avian Influenza (HPAI) across the study countries of Ethiopia, Ghana, Indonesia, Kenya, and Nigeria. The results of these CV studies are expected to feed into the cost-benefit and cost-effectiveness analyzes, which will be conducted to identify the effective HPAI control strategies in each study country. The information gathered through the Delphi study included (1) definitions of the small-scale producers (noncommercial/semicommercial and commercial) across the study countries, (2) estimations of the efficacy of various private and public control strategies in HPAI control, and (3) estimates of the proportion of poultry producers who are expected to adopt these control strategies under different scenarios. In this Delphi study, we collected data from 23 experts and analyzed the data by using statistical analysis methods. The results reveal that small-scale flocks are significantly larger in Indonesia, compared to the four African countries. The efficacy levels of both private and public HPAI control strategies investigated are significantly higher for commercial producers than for their noncommercial/semicommercial counterparts. Across private strategies and study countries, regular monitoring is thought to have the highest efficacy for those in the noncommercial/semicommercial sector, whereas regular disinfection and containment in hard material (as a combined strategy) was found to be the most effective strategy in minimizing risk in the commercial sector. Across public strategies and study countries, experts see surveillance by veterinary services as the most effective public sector HPAI control strategy in both the noncommercial/semicommercial and commercial sectors. Finally, according to the experts, small-scale poultry producers’ likelihood of adoption is low overall, although adoption rates are higher for commercial producers than for noncommercial/semicommercial producers.Adoption, commercial sector, Delphi study, disease risk introduction and spread, efficacy, expert elicitation, Highly Pathogenic Avian Influenza, HPAI, noncommercial sector, private disease risk minimization strategies, public disease risk minimization strategies, semicommercial sector, small-scale poultry producers,

Assessing the livelihood impacts of a livestock disease outbreak: An alternative approach

Because of the substantive role played by livestock in the income and asset portfolios of the poor, livestock diseases can be an important threat to livelihoods. Yet for a variety of reasons, there are few applicable methods and consequently scant literature to assess the impacts of livestock diseases on livelihood outcomes. Existing literature comprises small-area studies and computable models with wider geographic focus, both of which have limitations in this specific context. We propose an alternative approach for estimating the impacts of livestock diseases on livelihoods. This proposed approach is an adaptation of a quasi-experimental impact evaluation method, namely propensity score matching, which uses features available in large-scale datasets with wide geographic coverage to create counterfactual scenarios that could mimic outcomes of a disease outbreak. By its construction the method is well suited for ex ante impact assessment. As an illustration we apply the method to the hypothetical case of an avian flu outbreak in Kenya.Impact assessment, Livelihoods, livestock disease, Propensity score matching,