Valuation of Non-Market Services Provided by Gulf of Mexico Habitats Cristina Carollo David Yoskowitz, Alan Krupnick, Juha Siikamäki, Lauren Hutchison ACES 2014 Washington, D.C. December 10, 2014

The geographic location of the study is the US Gulf of Mexico coast

People engage in different activities along the US Gulf coast % Over the last 5 years have you done any of the following activities along the US Gulf coast? % that responded yes. Activities

Quantify preferences of ecosystem services provided by marshes, mangroves, and oyster reefs Source: NOAA Objectives: Isolate biophysical and ecological functions of target habitats; Identify ecosystem services that are salient to the public and easily measured; Quantify preferences (in monetary terms) of identified ecosystem services; Develop and provide decision support tool to end users; Develop and implement education/outreach activities and materials. Water Quality Aesthetic and existence Spiritual and historic Source: oysterrestoration.org Source: USGS

People think environmental conditions are worse now than in the past % How do you think environmental conditions have changed habitats on the US Gulf Coast? There are 3 graphs here! You can see them in slide show mode LA respondents have an especially negative perspective

Quantify preferences of ecosystem services provided by marshes, mangroves, and oyster reefs Habitat Water Quality Aesthetic and existence Spiritual and historic Recreation Passive use value Objectives: Isolate biophysical and ecological functions of target habitats; Identify ecosystem services that are salient to the public and easily measured; Quantify preferences (in monetary terms) of identified ecosystem services; Develop and provide decision support tool to end users; Develop and implement education/outreach activities and materials. Water Quality Aesthetic and existence Spiritual and historic Source: NOAA Source: oysterrestoration.org Source: USGS

Passive use values are not associated with any direct use of the ecosystem; they cannot be estimated using information on actual behavior Source: Diagram courtesy of the Integration and Application Network University of Maryland Center for Environmental Science. Nutrient regulation Spiritual and historic Estimating passive use values requires using stated preference valuation techniques. Source: B. Blomberg

The technique for eliciting and estimating passive use values employs choice experiments This implicitly requires tradeoffs, since no single alternative will perform better on all attributes In each choice, the respondent compares available alternatives and chooses the one with the best configuration of the individual attributes.

Mark the box at the bottom to indicate which program you would vote for What would you be willing to pay for the conservation of % of habitats? Marshes and mangroves: 5, 10, and 15% Oyster reefs: 3, 7, and 10%

The quality of valuation estimates from a choice experiment critically depends on the quality of the survey Number of respondents: 1274 Florida: 316 Alabama/Mississippi: 318 Louisiana: 297 Texas: 343 Rigorously developed respondent panel used broadly for academic research Representative samples at the state level Computerized survey Background information on marshes, mangroves, and oyster reefs: Distribution; Benefits; Status and threats; Conservation methods. Paying mechanism and voting: No further action; Program x. The purpose of the weights is to construct representative estimates along the following dimensions Gender (Male/Female) Age (18–29, 30–44, 45–59, and 60+) Race/Hispanic ethnicity (White/Non-Hispanic, Black/Non-Hispanic, Other/Non-Hispanic, 2+ Races/Non-Hispanic, Hispanic) Education (Less than High School, High School, Some College, Bachelor and beyond) Census Region (Northeast, Midwest, South, West) Household income (under $10k, $10K to <$25k, $25K to <$50k, $50K to <$75k, $75K to <$100k, $100K+) Home ownership status (Own, Rent/Other) Metropolitan Area (Yes, No) Internet Access (Yes, No)

Willingness to pay for improved habitat protection by habitat type and state (WTP per household per year per %-point change in the habitat area). A 90-percent confidence interval is indicted by vertical brackets. Estimation results from a multinomial logit model, which incorporates both observable and unobservable forms of heterogeneity (Model 3, see Table 2 below). We exclude each respondent who indicated that he/she: Voted differently from how he/she would vote in an actual ballot Did not understand that the program would increase the utility bill Would pay any amount for the program (infinite WTP) Voted NO for the program because he/she is against new government programs, not necessarily opposed to improved protections of coastal habitat Estimation uses individual weights to produce representative estimates at the state-level. Random parameter is estimated using Halton draws (n=100)

WTP for improved habitat protection decreases with increasing distance from the Gulf Coast Keeping everything else constant From Alan I met the guy who heads the Alabama Oil and Gas Commission and is a lifelong Alabamiam. I told him about our results. He said Alabama’s short coast has the most beautiful white sand and “everyone” in Alabama has a vacation place down there. And they rarely if ever go to the beach out of state. Big family tradition. So this could explain the lack of a distance gradient. He also said that Mississippi has mudflats rather than abeach. So he thinks we should split them up. Although having an undesirable beach could also account for a flat distance gradient, but WTP would be lower in Miss.

Preserving the environment for future generations is the primary driver % Aside from costs, which of the following was most important in making your decision about what program to vote for? Drivers

DWH oil spill did not affect respondents’ willingness to pay % When you voted, did considerations about the Deepwater Horizon oil spill affect your desire to pay for a program?

Project sponsors Thank you Cristina.Carollo@tamucc.edu

Survey Development 5 focus groups: Final survey testing Pilot survey: 2 Washington D.C. (pre-survey) 2 Texas 1 Mississippi/Alabama Final survey testing Mississippi/Alabama 6 surveys and 4 follow up one-on-one interviews Pilot survey: 50 in Mississippi/Alabama 50 in Florida Texas 2 with FWI and SLR

Survey Development - Voting “Please think carefully about how you would actually vote in these situations. We urge you to respond as though costs for your household really would go up if the program were implemented.” “Please take time to consider both the benefits of the program and the costs to your household.” “Paying the costs means your household would have less money to spend on other things such as food, clothes, trips, and even towards resolving other environmental problems you care about.”