Valuation Study

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Value of Water Quality Improvement

Attributes

Medium: Water

Country: China

Analytical Framework(s): Other

Study Date: 1999

Publication Date: 1999

Major Result(s)

Resource/Environmental Good CNY, per capita, per annum
(1999)
Existing-boatable 16.08
Boatable-swimmable 7.73
Existing-swimmable 23.81

Study Note: As of this study's time, the author noted that interest in benefit transfer has grown correspondingly and literature on the subject is substantial. But efforts to test the approach in developing countries are relatively few. Since most original valuation studies have been done in developing countries, efforts to validate the transfer of values between developed and developing countries, and between developing countries, are especially needed.

Study Details

Reference: Du Yaping. 1999. The Use Of Benefit Transfer In The Evaluation Of Water Quality Improvement: An Application In China. EEPSEA Research Report, No. 1999-RR.

Summary: This study uses the benefit transfer method to value water quality improvements to a recreational lake in Wuhan, China. Particularly novel is the comparison of results transferred from the US and the Philippines to the author's original study of the lake. After a brief review of methodological aspects in Section 1, relevant literature is screened and suitable cases were selected for the transfer exercise. In Section 3, the values from three primary studies were adjusted and transferred to the policy site to derive the environmental benefits from water quality improvement in East Lake, Wuhan. These benefit transfer values were further compared with results from the author's primary study to examine the validity of BT and its scope for wider application in China. Conclusions and discussion are provided in the last section.

Site Characteristics: East Lake (Donghu) is a recreational site well known for its vast water surface area (33 km2), natural tranquility, and beauty within the metropolitan boundary of Wuhan. Each year, millions of visitors come to the lake to enjoy recreational activities, most of which are directly related to water such as boating, swimming, and angling. Recently water pollution has seriously impaired recreational quality, especially for swimming. Three sites with swimming facilities have been closed as they are located in the most polluted part of the lake. As a result, people have to travel farther to find cleaner water, in areas that are less safe and less enjoyable because they lacked facilities. If water quality was a marketable good, its value would be easily determined and realized in the market. Since it is not, there is a need to estimate the value of water quality for recreation, which can be used as evidence by policymakers and the managers of the lake to see if clean up efforts are worthwhile. This provided the motivation for the author's 1997 study.

Comments: In selecting other studies for purposes of BT, the author concentrated on those that valued water quality improvement for recreational purposes. The literature was screened to find those study areas with similar features to the project case. Ideally, the socioeconomic situations in the study site should be as close as possible to the policy site. In reality, such similarities are very limited. In some cases, no information on some features is given in the literature. Therefore, in the screening process, socioeconomic features were used at the second stage.

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