Essays on the non-market valuation of environmental and transport programs in Ireland and the role of indifference
McGurk, Eoin
McGurk, Eoin
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Publication Date
2021-09-30
Type
Thesis
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Abstract
The agricultural sector in Ireland faces substantial challenges and is undergoing significant change. In terms of challenges, the financial viability of many farms is questionable, and the capability of an aging farming population to adapt, or replenish itself, is in doubt. European agricultural policy is attempting to re-orient itself to be more sustainable, focusing on the production of high-quality produce, and minimising the negative impacts of agricultural production. There is also a greater appreciation of non-market outputs of agriculture, whether these are environmental, amenity or recreational. There are opportunities for farmers to benefit from these changes if societal and farmer preferences can be aligned. In the absence of functioning markets for many of these goods, policy is essential to achieve such an alignment. Central to the realisation of successful policy is an understanding of farmer preferences and the incentives necessary to encourage their participation. To better understand these questions this thesis analyses farmer’s willingness to participate in agri-environmental schemes and in the greenway network. This analysis utilises a stated preference approach, the contingent valuation method with the survey data collected from a representative sample of Irish farmers. For farmers the choice to participate in either proposal would have direct and indirect impacts on their farm and how it is utilised. For this reason, many farmers may be opposed to participation. In general, contingent valuation methods assume that the participant being surveyed is conditionally willing to purchase or sell the hypothetical good being valued. With the key deciding factor assumed to be the bid, or price being offered. However, this assumption may not hold and for certain goods, individuals may not be willing to purchase or sell them for a reasonable value. While not universal among the farming population in Ireland, there are substantial proportions of the surveyed sample that are unwilling to participate in these schemes. Accounting for this was a central part of this thesis. In doing so two different models were used to analyse the dichotomous choice contingent valuation data, a spike model used to analyse farmer WTA a greenway on their land, and a bivariate probit with sample selection to analyse farmers willingness to participate in an AES. In addition, the performance of these two models in estimating WTA/WTP values was assessed against standard models using monte carlo analysis. Overall, the results show that while many farmers will not choose to participate in these schemes, there is a substantial proportion who would be willing to participate depending on payment levels and scheme specifics. In terms of which statistical approach to use, the most effective model will depend on what is being valued and whether payments can be targeted.
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Publisher
NUI Galway