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Ningaloo Collaboration Cluster: Estimation and integration of socioeconomic values of human use of Ningaloo

Posted on 03 November 2011

TitleNingaloo Collaboration Cluster: Estimation and integration of socioeconomic values of human use of Ningaloo
Publication TypeReport
Year of Publication2011
AuthorsHailu, A, Gao L, Durkin J, Burton M
Date Published06/2011
InstitutionCSIRO’s Flagship Collaboration Fund
ISBN Number978-0-86905-983-8
KeywordsCluster, human use, Ningaloo, socio-economy
AbstractBoth conservation and socioeconomic objectives need to be addressed in the management of natural assets like Ningaloo. If these concerns are perceived to be in conflict or partly in conflict with each other, policy-makers and managers face the difficult task of balancing the two. This balancing exercise becomes more difficult in the case of resources where some of the socioeconomic benefits are largely non-market and, therefore, cannot be directly observed or valued in market transactions. Visitors are attracted to Ningaloo for fishing and other non-fishing recreation. These recreational activities generate non-market benefits. That is, we are not able to observe directly the value people attach to the opportunities or the sites that are made available for recreation. The market transactions associated with recreation, such as the money that visitors spend for accommodation, food, transport and other activities, represent only a portion of the socioeconomic benefits of these recreational activities in the region. The approach adopted in our study therefore adds a new dimension to the information typically reported on tourism and economic benefits of recreation. Visitor expenses are cost to the visitors and, although they generate benefits to the regional economy, do not capture or reflect the full value derived from recreation. The true value of recreation is the economic surplus that visitors gain over and above what they spend as they engage in recreational activities. This economic surplus is defined as the monetary amount visitors would be willing to pay (WTP) for the opportunity to recreate over and above the cost associated with the recreation. This surplus value has to be inferred using non-market valuation techniques which utilize information derived from surveys of visitors (see below) or from observations of recreational behaviour. The term “economic welfare” is alternatively used to describe the economic surplus value. Economists have developed techniques that help generate value estimates for the natural environment and these have been applied to a diverse set of valuation problems over the last three decades. In studies of recreation, economists usually employ site choice models, which hypothesize that people make choices to maximize the satisfaction (utility) they derive from recreational choices. Further, the techniques link choice to site characteristics, making it possible for the researcher to infer the relative values of different site attributes or characteristics. In summary, site choice models provide two useful results: a model of recreational behaviour and value estimates for both sites and site attributes. This project developed site choice models for Ningaloo and used these models to evaluate economic surplus value (or economic welfare) changes arising from management changes. Further, the project developed the site choice models into agent-based models that can be used for simulating recreational choices and associated welfare changes under different management scenarios. In the sections below, we present the specific objectives of the project, its findings and their management implications.
Refereed DesignationUnknown
Estimation and integration of socioeconomic values of human use of Ningaloo.pdf687 KB