Advances in Stated Preference Studies for Valuing and Managing the Environment - A Developing Country Context

PhD defence

Habtamu Tilahun Kassahun


The most important factor that inspires the work of this dissertation is the loss of ecosystem services. Soil erosion, deforestation, and loss of biodiversity are prevalent in developing countries. Thus, reliable estimates of their values are crucial for policy making and sustainable management of environmental and natural resources.  However, empirical evidence shows that many valuation studies conducted in developing countries are of poor quality, questioning the reliability of their results. Therefore, the core work presented in this dissertation aims at improving the reliability of stated preference (SP) studies by addressing critical issues across four self-contained articles using three examples of SP surveys related to the Blue Nile ecosystem service valuation and watershed management. The dissertation answers three core research questions: 1) What incentive mechanisms can motivate farmers to participate in a new integrated private and common land management activity to reduce both on-site and offsite impacts of soil erosion and hence provide ecosystem services? 2) How much are ecosystem service users willing to pay for watershed management in the Blue Nile Basin?, And 3) How can stated preference methods be improved to get reliable value estimates?

From this PhD study, we can draw three general conclusions regarding managing watershed externalities and application of SP methods in a developing country context. 1. There is no uniform incentive to motivate ecosystem service providers to implement land management strategies to reduce both on-site and offsite impacts of soil erosion. Thus, policy design to address both the on-site and off-site effects of soil erosion in the Ethiopian highlands of the Upper Blue Nile Basin should consider the heterogeneity of preference for incentives across different groups of farmers.  2. Citizens are willing to pay a substantial amount of money for environmental services. However, from our results we can conclude that the overall WTP for environmental services are often underestimated.  3. SP methods can provide reliable estimates of value in a developing country context. However, several issues need to be considered in the design of the survey instrument as well as in the data analysis.


Jette Bredahl Jacobsen (Principal supervisor), Professor, Department of Food and Resource Economics, University of Copenhagen

Paola Gatto (Co-supervisor), Associate Professor, Department of Land, Environment, Agriculture and Forestry, University of Padova, Italy

Assessment Committee

Thomas Lundhede (chairman), Associate Professor, Department of Food and Resource Economics, University of Copenhagen

Riccardo Scarpa, Professor, Queens University Belfast, Northern Ireland, UK and University of Waikato, New Zealand

Ståle Navrud, Professor, Norwegian University of Life Sciences, Norway