On-line version ISSN 2222-3436
Print version ISSN 1015-8812
S. Afr. j. econ. manag. sci. vol.13 n.2 Pretoria Jan. 2010
Application of the contingent valuation method to estimate the willingness-to-pay for restoring indigenous vegetation in Underberg, Kwazulu-Natal, South Africa1
M Du Preez; S Tessendorf; SG Hosking
Department of Economics, Nelson Mandela Metropolitan University
This study estimates the willingness-to-pay (WTP) for a project (i.e. the Working for Water Programme) aimed at removing alien vegetation and restoring indigenous vegetation in Underberg, KwaZulu-Natal, South Africa. The WTP estimate reflects the benefit of preference for indigenous vegetation over alien vegetation. In a survey, a questionnaire was administered to 260 households in the Underberg region during September 2005. It was deduced that the mean WTP for the project was R21.12 in 2005 (R26.40 in 2008), the total WTP was R25 344.00 (R31 680.00 in 2008) and the WTP per hectare was R21.87 (R27.34 in 2008). A valuation function to predict WTP responses was also estimated. The function showed that knowledge of the local Working for Water Programme and income were important determinants of WTP.
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Accepted October 2009
1 The helpful comments made by two anonymous referees are gratefully acknowledged.
2 An anonymous referee felt that this was a controversial point to make.
3 After the pilot study the questionnaire was simplified and improved.
4 This was done in an attempt to reduce mental account bias.
5 R26.40 expressed as a percentage of (157 354m3 x R0.59/m3)/1159ha or R80.10/ha/a.