Valuation of Environmental Assets by the Surrounding and Not Surrounding Beneficiaries

Abstract

The basic research question behind this work is how the economic value of an environmental good differs considering surrounding beneficiaries (those who live near the good in question) and not surrounding beneficiaries (who inhabit the country where the good is, living in distant communities and therefore rarely enjoying the benefits provided by the environmental good). This document’s main focus is the valuation of the Algarrobos Forest of the Tiataco community (Bolivia). A comparative analysis was developed between surrounding beneficiaries (families residing in the community of Tiataco) and not surrounding beneficiaries (families residing in Cochabamba city, 35 km from Tiataco) through the Contingent Valuation Method with binary format. Measures of change regarding the welfare of both groups were estimated using parametric and nonparametric estimates.Subsequently, these measures were statistically compared through the construction of confidence intervals (between parametric and nonparametric estimates of each population and between populations). Finally, we identified the components of total economic value that both surrounding and not surrounding beneficiaries assigned to the forest.