The Economic Value of Forest Services in the Keffa Zone, Ethiopia: Discrete Choice Experiment Approach

Abstract

The value of forests encompasses both direct market benefits and non-market advantages related to nature conservation. The value of forests, including timber, lumber, pulp, and paper, is exchanged through markets. However, many of the benefits of forests do not pass through the market. The study was carried out to estimate the nonmarket economic value of forest resources in the Keffa Zone, Ethiopia. To address the objective, a cross-sectional research survey was conducted among 343 households, with face-to-face interviews serving as the primary data collection method. The study was conducted on five forest attributes: harvested forest products, rainfall attraction, soil conservation, tourism-generated employment, and the use of the forest for future generations, representing the non-market value of the forest. The discrete choice experiment estimate, based on multinominal logistic regression, was used to analyse the data and estimate the economic value of the forest. The study estimates that households would pay an average of $7.71/year/hectare for forest conservation to achieve 20% more additional rainfall and water availability. The households are also willing to pay an average of $2.32/year/hectare for the forest’s conservation to avoid 20% soil loss. The households in Keffa would annually pay an average of $9.10/year/hectare and $1.31/year/hectare for the forest’s conservation, receiving 10% and 20%, respectively, more tourism-generated income and employment. The estimated results suggest that the local community supports the conservation of the forest, and households are willing to contribute considerable resources for the proposed conservation programme in the study area.