Using Contingent Valuation to Estimate the Value of Forest Ecosystem Protection

In recent decades, concerns have arisen about the proper valuation of the world's forests. While some of these concerns have to do with market distortions for timber products or inadequate data on non-timber forest products, an additional issue has been the challenge of uncovering the economic worth of non-market services provided by forest ecosystems (Kramer, Healy and Mendelsohn). This has led to the emergence of a growing set of literature addressing the valuation of forest ecosystem services such as carbon sequestration and endangered species habitat. In this chapter, we focus on the valuation of forest ecosystems, emphasising the use of contingent valuation method to value the structure, health and extent of forest ecosystems. Forest ecosystems generate a wide variety of use values, the most important of which are timber, non-timber products, recreation, wildlife habitat and watershed services. While these use values are important, and their provision was the primary objective of public lands’ management in the past, increasingly public land managers are confronted with demands arising from passive use values. The contingent valuation method (CVM), a stated preference method, has proven to be a useful technique for uncovering the passive use values of forest quality. A number of applications are reviewed below. More recently, analysts have turned to another stated preference method, conjoint analysis