1. Introduction
2. Why value natural resources?
3. Potential valuation methodologies
4. Results from resource valuation exercises in Zimbabwe
5. Outlook
6. Acknowledgements
7. References
by B. Campbell,
University of Zimbabwe.
May, 1993
Paper prepared for the FAO expert consultation on non-wood forest products (anglophone Africa).
In the last two decades, debates on development and resource exploitation have increasingly centred on sustainability issues (e.g. Barbier, 1987; Beets, 1990; Katerere et al., 1991; World Commission for Environment and Development, 1987). Often the debates have lacked an economic component or, where the debates included economic arguments, these were oversimplistic and incorporated little more than marketed output, and the capital and labour invested for this output. Generally, no economic value was assigned to changes in natural resource stocks (Repetto, 1992). Furthermore, the economic analyses in developing countries paid scant attention to subsistence production and to labour (the latter was 'surplus') (Repetto, 1992).
With such poor analytical tools, it is not surprising that policy decisions regarding development options have often had no positive impact on society and, in extreme cases, have resulted in wholesale disruption of natural systems (e.g. Browder, 1988; Mahar, 1988; Sinclair and Fryxhall, 1985). One example in Zimbabwe from the early 1980s is the US$7.3 million investment in the rural afforestation programme, which was made in the context of a fuelwood crisis without almost any analysis of the value of natural woodlands and trees to rural households (World Bank, 1990). The outputs from this programme have probably had little positive impact (World Bank, 1990). In addition, one small component of the programme saw the replacement of indigenous woodland of arguably high value with eucalyptus plantations of arguably no value (pers. obs.; World Bank, 1990).
In the last few years, there has been a massive increase in awareness that analyses for decision-makers about development and resource exploitation have to incorporate accounting for environmental assets (Repetto, 1992; Scoones et al., 1992; Swanson and Barbier, 1991). In this paper, I look at the efforts to value tree-based resources in Zimbabwe. Other data from the region are reviewed, but these are mostly non-existent. Most of the work on tree-based economics in the region has focused on alley cropping systems (see Swinkels and Scherr, 1991), which are not at present common in the region (Campbell et al., 1991a). Resource economics in the tropics has centred on moist tropical forest (e.g. Hecht et al., 1988; Rasoanaivo, 1990; Peters et al., 1989). In this paper, the focus is on dry tropical savanna-woodlands (miombo, mopane, teak and Acacia woodlands - White, 1983). In these woodlands, only wildlife values have received much attention and here the focus has been on direct use values (e.g. Barbier et al., 1990; Jansen et al., 1992; Swanson and Barbier, 1991).
The essential question that requires answering is how much is the woodland worth, and to whom? The results of the few studies are reviewed and a research agenda for future work is outlined. To place the Zimbabwean work in context, the first sections deal briefly with why valuation is necessary and methodological approaches to valuation.
Numerous fora have identified the need to value natural resources and to develop appropriate valuation methodologies. For instance, one of the recognised priorities for forestry and agroforestry policy research is the development of mechanisms for: (i) a balanced valuation of environmental benefits in national accounts and (ii) valuing trees and forests from a local perspective to complement national valuations (Gregersen et al., 1992). One of the four programme areas that make up Chapter 11 of Agenda 21 deals with 'capturing forest values' (Ayling, 1993). Within the body of literature devoted to non-wood forest products, it is recognised that there is a need to improve the valuation of the social and economic benefits derived from these products (de Beer and Mcdermott, 1989; FAO, 1991; Scoones et al., 1992).
In the Zimbabwean context, attention has been drawn to the fact that the valuation of natural resources has been inadequately dealt with (Bojo, 1993; Campbell et al., 1991b; Moyo et al., 1992).
There are a number of reasons why tree-based resource valuation is necessary in Zimbabwe and most other developing and tropical countries. At the global scale, the following question remains unanswered: What is the value of woodlands in terms of recreational values, biodiversity conservation and impact on climate? (Bojo, 1993). At the national level, valuation is required as a key input to decisions about land allocation and land use (Bojo, 1993; Moyo et al., 1992; Scoones et al., 1992), for instance:
(i) Given the proposed land reform programme to address the gross inequities in land distribution (Katerere et al., 1991), how can woodlands be appropriately valued? What are the costs and benefits associated with the loss of woodlands (Grundy et al., 1992) that will occur in the resettlement areas? If land taxation is used as an instrument to increase the supply of commercial farmland for the land reform programme (Murphree and Cumming, 1991), on the basis of what value should the large tracts of indigenous woodland on this farmland be taxed? (Bojo, 1993; Moyo et al., 1992).(ii) Roughly 10% of Zimbabwe's woodlands are managed by the parastatal, Forestry Commission. Conservation of these State Forests is often justified on the basis of protection of watersheds and conservation of biodiversity. However, what are the costs and benefits of conservation? (Bojo, 1993; Moyo et al., 1992).
(iii) In tree-based development programmes, where should the emphasis lie? Do rural households need investment in woodlots, fruit tree orchards or fodder trees? How valuable are non-wood forest products? Conventional resource planning is biased in the favour of commercial harvest and has undervalued other goods and services (de Beer and Mcdermott, 1989; Scoones et al., 1992).
(iv) Much has been written about resource degradation (e.g. Katerere et al., 1991; Campbell et al., 1988). What are the costs associated with woodland degradation? In particular, what are the off-site downstream impacts of degradation? How can the costs of negative externalities be internalized to enhance efficient and sustainable use of resources (Moyo et al., 1992).
(v) Ultimately, one must ask whether it is possible to have an amended system of national accounts incorporating information about changes in natural resources? (Bojo, 1993).
From the outset, it should be stressed that the present paper deals with monetary valuation, but that there are a wide range of non-monetary indicators of value that can be used (de Beer and Mcdermott, 1989), such as frequency of consumption of forest products, frequency of collection, and percent of household time-budgets devoted to forest-related activities. Many of the indicators need to be collected for certain approaches to monetary valuation.
Values of tree-based resources can be classified into three classes: values associated with use (use value); values related to potential use (option value) and values associated with mere existence, for instance the benefit associated with knowing that some woodland type exists (existence value) (Bojo, 1993; Krutilla, 1967; Scoones et al., 1992; Weisbrod, 1964). What goods and services of trees and woodlands should be considered? Traditional economic analyses of forestry activities have concentrated on the use values of wood. The full range of non-wood forest products have to be considered. Furthermore, analyses have focused on marketed goods. Most woodland products are in fact used for subsistence (Campbell and Brigham, 1993), and hence there is a need to incorporate nonmarket use values. In addition, it is necessary to include option and existence values in valuation exercises. Finally, how can woodland service functions (indirect use values), such as climate modification, soil fertility improvement and biodiversity maintenance, be valued?
In the absence of organized markets, an intuitively appealing approach to revealing the preferences of individuals is the use of contingent valuation methods (CVM) (Davis, 1963; Mitchell and Carson, 1989). These techniques use a hypothetical market situation to obtain bids from individuals indicating their willingness to pay (WTP) for a commodity. Despite the widespread use of these methods, the reliability of values obtained using CVM is vigorously debated (e.g. Bishop and Heberlein, 1979; Brookshire and Coursey, 1987; Knetsch and Sinden, 1984).
Many tree-based goods and services are closely linked with conventional markets, e.g. tree litter for fertility maintenance can be replaced (at least, partially) by inorganic fertilizers, off-site impacts of woodland clearing in terms of downstream siltation can affect crop output through reduced irrigated production. Hence, it is possible to value tree-based resources by tracing their link with organized markets. Bojo et al. (1990) identify a number of major classes of techniques in this group, two of which are relevant here: that based on production values, in which the losses or gains to production are estimated and valued, and that based on replacement costs, i.e. the cost of replacing tree-based goods and services with those from organized markets.
Contingent valuation of tree-based resources
The most comprehensive attempt to date to value woodland resources in Zimbabwe is that of Campbell et al. (1991b), in which two approaches were used, one based on CVM (Lynam et al., in prep.) and one based on a mixture of production values and replacement costs, to value goods and services derived from miombo woodland by residents in communal areas.
In the CVM approach, ten cards representing commodity categories of trees and two cards representing commodities not related to trees were explained to respondents, and respondents ranked and distributed 50 matches among the cards to reflect the relative importance of each category of commodities. The two extra cards showed a hand pump and a well-known design of latrine. The CVM was based on the willingness of respondents to pay for a fifth share in a borehole with a hand pump. Values were derived for all tree commodity categories by standardizing the points allocated to the categories against the points allocated to the borehole and then multiplying by the expressed willingness to pay (WTP). Direct questions of value about tree resources were considered inappropriate because of the 'inexperience of most respondents in dealing with monetary valuations of tree resources' (Lynam et al., in prep.), and hence a borehole was selected for valuation.
To check the validity of the WTP estimate, (i) actual costs of building and installing a borehole with hand pump were compared with the WTP estimate; (ii) respondents were asked what compensation they would be willing to accept if the hypothetical borehole were to be destroyed, and this was compared to the WTP estimate; (iii) respondents were asked, in a set of dichotomous questions, to choose between a shared borehole and five common commodities decreasing in value from about Z$35000 (a tractor) to Z$90 (in mid 1991, at the time of the analysis, Z$1.00 = US$0.32); (iv) the calculated value of the latrine derived from the points allocation was compared to actual costs of building and installation, and (iv) hypothesised trends in WTP with mean annual rainfall and with present kind of access to water were compared with stated WTP. In general, the validity checks supported the use of the WTP estimate, but sharing of a borehole was based on five sharing households and a linear demand curve was assumed. It would have been preferable to have investigated the nature of the demand function.
The mean values elicited by the CVM for different tree commodities are shown in Table 1. Direct material inputs to major productive practices are the most valuable categories of commodities that households obtain from tree resources (Lynam et al., in prep.). These include wood for fuel and wood for construction, inputs to crop production (woodland litter, scattered trees in cropping areas) and animal feed (dry season browse). It is somewhat surprising that fuelwood is regarded as so important, and that food products from trees (e.g. fruits) are not placed in this top grouping, considering that many other studies have indicated that tree planting by households is based on fruit trees, with planting of trees for fuel being a very low priority (Grundy et al., 1992; Campbell et al., 1993; Bradley and Dewees, 1993). One must ask the question as to whether it is present utility that householders are basing their valuation, and whether it would be more desirable to value the potential utility of trees? (Bradley and Dewees, 1993).
CVM is an important technique because it can be used to obtain values for various service functions of forests. Respondents valued 'ecological services' of trees relatively highly (Table 1), these being regarded as soil fertility maintenance, soil erosion control, climate control and maintenance of stream flow. Other such intangibles are much less important commodities (Table 1). These include shade, health (medicinal plants) and social services (embracing cultural and spiritual values). Clash income from tree products is also relatively unimportant.
The values derived from the CVM are regarded as capital values, and can be converted to annual benefits using an appropriate discount rate. Using rates between 5 and 20 %, annual benefits derived from tree resources amount to between Z$84 and Z$336 per household per year. Lynam et al. (in prep.) suggest that the benefits derived from tree resources could be equivalent to between 12 and 160 % of off-farm and agricultural production incomes in the different study areas.
Table 1. Values derived for various categories of tree-based goods and services using a contingent valuation method (Lynam et al., in prep.). The categories are arranged in order of importance. Mean values which differ significantly at p = 0.05 are shown by different alphabetic superscripts. The ranking of the categories by the replacement-production method (Table 3) are also shown (see text, data from Campbell et al., 1991b).
|
|
Contingent valuation |
Ranking of categories by replacement-production valuation |
|
|
mean value Z$ HH-1 |
median value Z$ HH-1 |
||
|
Fuel |
373a |
500 |
2 |
|
Farm/house materials |
290b |
400 |
3 |
|
Crop production |
222c |
333 |
5 |
|
Animal feed |
181c |
144 |
4 |
|
Ecological services |
175c |
257 |
not assessed |
|
Food |
136c |
200 |
1 |
|
Shade |
102d |
150 |
not assessed |
|
Cash income |
82d |
125 |
6 |
|
Health |
71d |
100 |
not assessed |
|
Social services |
46e |
47 |
not assessed |
|
Total |
1678 |
2256 |
|
Z$1.00 = US$0.32 in mid 1991, at the time of the survey.
Lynam et al. (in prep.) argue that the values can be used to gain insight into behaviour as regards resource use and technology adoption. Using the example of fuelwood, they show that with annual benefits of only Z$37 per household (assuming a 10 % discount rate) and with eucalyptus wood for a year costing roughly five times this value, it is not surprising that farmers seem reluctant to invest in eucalyptus woodlots. However, the same conclusion may be reached for fruit trees, which is not the case, as householders are interested in planting fruit trees. Such calculations need to be carefully interpreted as they clearly depend on the discount rate chosen and the meaning attached to value by the respondents (Bradley and Dewees, 1993).
Replacement-production valuation of tree-based resources
In the other approach of Campbell et al. (1991b) to value tree-based products, a mixture of replacement cost and production value methods was used (Table 2). The economic valuation is crude by necessity: the available data do not allow for accurate economic accounting (Campbell et al., 1991b). In most cases the estimated value is calculated simply from a knowledge of the quantity of goods derived from trees multiplied by the 'farm gate prices' of these goods or the 'replacement cost'.
Table 2. Methods used to estimate value for different tree-based goods and services in the replacement-production valuation (Campbell et al., 1991b).
|
Fruit |
Production data for fruit trees, market values of replacements, indigenous fruits on a per hectare basis, exotics on household plantings |
|
Other wild foods |
Consumption data for households, market values of replacements |
|
Fuelwood |
Consumption data for households, market values of replacements |
|
Construction wood |
Consumption data for households, market values of replacements |
|
Craft wood |
Household output of marketed products |
|
Livestock production |
Value of livestock, extra benefit provided by trees compared to absence of trees, on a per hectare basis |
|
Crop production |
Litter from woodlands - consumption data for households, market value of inorganic nitrogen |
By using farm gate price of a subsistence product, they assigned value on the basis of exchange value. Replacement cost is the cost a producer would have to pay to replace the subsistence product. Because of the use of farm gate price or replacement cost for goods which, in fact, are mostly not bought and sold, there is an overestimate of local use value (Campbell et al., 1991b; Bojo, 1993), as: (i) in most cases, the financial constraints facing small-scale farmers do not permit them to switch to a marketed product; (ii) small-scale farmers would probably not choose to buy the marketed replacements if the necessary financing were made available to them unconditionally; and (iii) the prices used do not take into account 'diminishing marginal utility' (if all the fruits were taken to the market place, the price per fruit would drop dramatically).
That the data base is limited is evident by a recalculation that has been done for the present paper for the value of leaf litter to crop production. On the basis of new litter consumption data (Nyathi and Campbell, 1993), the new estimate of value is 20 % of the estimate in Campbell et al. (1991b) (Table 3). On the other hand, recalculation of income from craft work from data from Brigham (in prep.) support the previous estimates. The model SCUAF (Young and Muraya, 1990) was used to simulate fertility improvements by scattered trees. Since then, testing of that version of SCUAF demonstrated serious flaws (Vermeulen et al., 1993), but this is unlikely to make large differences because of the small number of trees in fields.
Another problem related to data limitations, is that some categories of value were estimated on a per hectare basis while others were estimated on a household basis (Table 2). For instance, value of wood was based on household consumption, whereas value of fruit from indigenous trees was estimated on the basis of per hectare production from woodland and from scattered trees in cropping land. In order to express value on common scales, it was assumed that the average area of woodland available to each household (HH) ranged from about 3.5 ha HH-1 to 5.6 ha HH-1 in the three study areas covered by the work (calculated on the basis of areas of communal woodland and 1991 projected population figures) and that the area of cropping land averaged 3 ha HH-1. Using these conversion factors, value can be expressed either on a per hectare basis or a per household basis, but an additional source of error is introduced.
The point to be made is that the figures produced have to be used with caution because of the poor data base. Some sceptics would probably discount the method entirely for the reason of poor data. One partial solution is to ensure reporting of statistical variability, but this itself is not simple, as the estimates for different categories are based on different kinds of data. In the present paper, ranges are reported where possible (Table 3).
Woodland produces goods to the value of about Z$200 ha-1 yr-1, while scattered trees in fields value at about Z$10 ha-1 yr-1. In total, trees produce goods to a value of nearly Z$1000 HH-1 yr-1 Our valuation is mostly based on household consumption data. If current consumption is in excess of sustainable levels of production, the values we obtain, especially for fuelwood and construction wood, do not account for environmental degradation as a result of non-sustainable use. Generally, if progressive decline of the woodlands is occurring, the key issue is likely to be the future effects rather than current value as determined here.
There is a major difference in the ranking of categories derived from the two valuation techniques in regards the placing of food from trees (Table 1). Firstly, the differences in the rankings could be due to the poor data used in the replacement-production valuation to calculate the value derived from indigenous fruits. The valuation was based on very poor production data. It would be simpler to obtain household consumption data and base the valuation on this. Secondly, it should be noted that some differences are expected, as the two techniques estimate different components of value. The CVM estimates capital values, which then have to be converted to annualized benefits using a selected discount rate, which could vary among different categories. The replacement-production valuation estimates annual gross benefits. Net benefits could be calculated if the costs of using the different resources could be quantified. This mostly relates to labour and transport costs.
Table 3. Gross values of tree-based goods and services, expressed as value to a household (HH) and woodland value. Data derived from Campbell et al. (1991b). Cash income for households and value of woodland for cash income are shown separately, as this component of value is included where appropriate in the product categories.
|
|
|
Value to a household (Z$ HH-1 yr-1) |
Value of woodlands1 (Z$ ha-1 yr-1) |
|
Fruit |
indigenous fruits in woodland |
230-360 |
65 |
|
indigenous trees in cropland |
10-44 |
|
|
|
planted exotics |
12 |
|
|
|
Other wild foods |
|
63 |
11-18 |
|
Fuelwood |
|
183 |
33-52 |
|
Construction wood |
buildings |
114 |
20-33 |
|
implements, utensils for own use |
16 |
3-5 |
|
|
craft wood income |
7-18 |
1-5 |
|
|
Livestock production |
|
100-168 |
30 |
|
Crop production |
litter from woodlands2 |
17 |
3-5 |
|
fertility from scattered trees |
15 |
|
|
|
TOTAL |
|
767-1010 |
166-213 |
|
Cash income |
exotic fruits |
17 |
|
|
wild fruits |
2 |
<1 |
|
|
craft wood3 |
7-18 |
1-5 |
1 Only those products obtained from woodland are included in this column, thus excluding products from planted exotics and indigenous trees scattered in cropping land and homesites.
2 Recalculated on the basis of 0.38 tonnes per user household per annum of litter used (Nyathi and Campbell, 1993, for Masvingo communal areas).
3 Data from Campbell et al. (1991b). Using recent estimates of craft trade and income from Brigham (in prep.) would result in similar overall figure.
The same methodology to the above was conducted to value Acacia savanna in South Africa (Milton and Bond, 1986). These authors arrived at a similar total value, but the relative value of various commodities was different. Gumbo et al. (1989) looked at the value of Sclerocarya birrea trees in Southern Zimbabwe. They used a replacement cost method to derive a value for the trees. The direct value of the products (fruit, wine, wood products, nutrient inputs) over time far exceeds the value realised by chopping the tree down, hence they provided an economic rationale for maintaining the trees.
There are very few other studies of relevance, and most of these have concentrated on marketed products. Brigham (in prep.) investigated the marketed output of all woodland products in one communal area in Zimbabwe, while Cunningham (1990a, 1990b) measured incomes derived from palm wine production in South Africa and described the trade in medicinal plants in southern Africa. The study of Campbell et al. (1991b) also recorded income levels from tree-based resources. As can be seen, these are relatively insignificant by comparison to the total value of tree-based resources (Table 3).
Valuation of livestock and wildlife
Although livestock and wildlife are not strictly tree-based resources, they rely heavily on trees for the provision of browse, and the value of cattle calculated by Scoones (1992a) was used as an input to the calculation of the overall value of woodlands by Campbell et al. (1991b).
There are a number of examples of the economic valuation of cattle in communal areas, all based on calculating value using replacement costs, because most commodities derived from cattle are not marketed. These valuations have been reviewed by Jackson (1989) who highlights the assumptions that have been used and states that it is unclear as to whether the different valuation results are due to different farming systems or different assumptions. He concludes that valuing the economic benefits of livestock within communal areas is at a very rudimentary stage. The different results have different policy implications, and therefore there is a need to resolve the differences. For instance, in one of the valuations manure production is seen as five times more valuable than milk production whereas in another valuation, the opposite is recorded.
Perhaps the most detailed valuation is that of Scoones (1992a). Data on biological productivity, milk production, sales and slaughters, manure production and work rates are presented for cattle and goats. The economic valuation is more complete than that for tree-based resources described above, as it includes the costs of production (veterinary support and stock herding), and thus gross and net benefits can be calculated. Furthermore, the data on which the entire analysis is based are more reliable than those available for valuation of tree-based resources. Lacking from the valuation is the social value of cattle, in particular for bridewealth. It would be of interest to pursue contingent valuation for such intangibles, as farmers rank the bridewealth function third after transport and draught (Scoones, 1992a).
The gross value for cattle is around Z$800 yr-1 adult-1 (Z$1.00 = US$0.66 in 1987), and the net economic value of communal area cattle and goat systems is Z$104.50 ha-1 yr-1 (Scoones, 1992a). Patterns of investment in livestock are discussed in relation to the valuations made. In communal lands the rate of return on investment is high for cattle and goats and returns to grazing land are considerably higher than in conventional beef ranching, as long as the full range of livestock products and services are accounted for. Perhaps one flaw in the analysis relates to the use of actual stocking rates rather than officially recommended stocking rates (which are two to three times lower), in the absence of any calculation of the environmental costs of maintaining such high stocking rates, a subject of hot debate (e.g. Sandford, 1982; Scoones, 1992b; du Toit and Campbell, 1989; Child 1988, 1990; Taylor and Child, 1991). Using more conservative stocking rates, reduces the net economic value to about Z$30-Z$40 ha-1 yr-1 (see for example Barrett, 1991). Jansen et al. (1992) provide an estimation of the cost of overstocking (see next section), but there estimate is for commercial livestock systems.
Jansen et al. (1992) provide the most detailed account of the value of commercial production of wildlife and livestock. In a survey of 89 commercial farms in the drier regions of Zimbabwe, they compare the financial and economic profitability of cattle ranches, wildlife ranches and mixed system ranches. They include in their analysis all sources of income and all costs (including labour, capital, cost of degradation). It appears that wildlife only ranches are the most financially viable and have an average return on investment of 10.5 % compared to only 3.6 % for mixed enterprise systems and only 1.8% for cattle only ranches. Similar conclusions are arrived at for economic profitability.
In comparison to this very detailed valuation of wildlife on commercial farmland, there has almost been no work on wildlife values on communal land. Murindagomo (1988) showed that for a remote community, the value of subsistence hunting was Z$8.2 ha-1 yr-1, while commercial safari hunting yielded Z$1.54 ha-1 yr-1. There is also scattered data available on the amounts of income realised by wildlife schemes in communal areas (e.g. Cumming and Bond, 1991), but very little detailed valuation work has been undertaken.
Costs of environmental degradation
There are only two studies in Zimbabwe which have explored the costs of environmental degradation, that of Elwell and Stocking (1988) which investigated the regional effects of soil erosion in relation to the cost of replacement of the lost nutrients, and that of Jansen et al. (1992) which estimated the cost of overstocking by livestock and wildlife. In both studies, the influence of trees on the degradation dynamics was not investigated.
The valuation by Elwell and Stocking (1988) is limited to the extend that it is based on erosion simulation models, which are most applicable to cropped land and not grazing land and woodlands. They calculated that the annual cost of soil erosion to Zimbabwe was Z$2.5 billion (1985 prices).
Our understanding of the degradation process by livestock and wildlife is incomplete and hence any attempt at valuation is problematic. Jansen et al. (1992) base their estimate on the work of Child and Taylor on a commercial range (Child, 1988; Taylor and Child, 1991), thus the estimate is of little value for communal systems. Using long-term data, they have calculated the loss in productivity due to overstocking as an average annual productivity loss of 0.32 kg livemass ha-1 yr-1. Using carrying capacity estimates and actual stocking rates, they were able to calculate the productivity loss per overstocked livemass. With estimates for livemass prices, they then converted productivity losses to costs, which amounted to Z$0.113 per kg of overstocked livemass per hectare per annum. This cost and an estimate of the degree of overstocking (calculated from known stocking rates and carrying capacity estimated from relationships between rainfall and biomass), were used to estimate the cost of overstocking on the 89 ranches they studied. The estimates are crude but the methodology is innovative and would be worth further investigation.
Avoidance cost valuation of carbon sequestration
Bojo (1993) made a preliminary valuation of the carbon sequestration function of woodlands in Zimbabwe. Valuation is regarded as hypothetical as there are at present no binding international agreements to limit CO2, and actual monetary transfers will have to take place from developed countries to underdeveloped countries, as it is unlikely that decision makers in Zimbabwe will be much impressed by the fact that somewhere in the industrialized world costs are being saved by the decision to preserve indigenous Zimbabwean woodland.
Bojo (1993) bases his calculation on the data in Nordhaus (1991) which gives costs of reducing emissions per quantity of carbon. Given an average of 42 t ha-1 of wood in the remaining woodland (from Bradley and McNamara, 1990), the value of woodland from a carbon sequestration point of view would be about US$200 ha-1, which would could be paid as a lump sum or as an annual, infinite payment of US$20 ha-1 (assuming an interest rate of 10%) (about Z$140 ha-1 in mid-1993).
Value of tourism
Tourism in the region is said to be based on the wildlife resource (Buetzler, 1990), which in turn is centred on the woodlands of the region. However, in Zimbabwe the outstanding tourist attraction, Victoria Falls, also accounts for considerable tourism revenue. There have been no detailed analyses of the value of tourism, and the data available are scattered (e.g. Cumming and Bond, 1991; Jansen et al., 1992). The tourism industry is considered the third most important source of foreign currency behind mining and agriculture (Jansen et al., 1992), and thus detailed analyses of it are particularly needed.
Comparative valuation of different land-uses
There is now a growing literature on the comparative economics of different land uses. Previous analyses have compared communal livestock systems with commercial livestock systems (e.g. Scoones, 1992a) and compared livestock and wildlife systems (e.g. Jansen et al., 1992), but the only attempt to place trees in the centre of such an analysis is that of Bojo (1993), who has used much of the data presented above. Because of the data limitations, it is perhaps premature to make many strong conclusions, but it does appear that indigenous woodlands, particularly in the drier regions, compete well with other land uses (Bojo, 1993). One of the chief limitations restricting comparison is that the estimates for tree-based resources represent gross incomes, not gross margins, because no costs of production have as yet been included in the valuation.
The review indicates that a modest start on resource valuation has begun, but that research on many topics is required before resource valuation is going to contribute meaningfully to decision making. The questions posed in the earlier sections remain unanswered: How much is the woodland worth, and to whom? What is the value of woodlands in terms of recreational values, biodiversity conservation and impact on climate? What are the costs and benefits of catchment conservation? How can resource valuation be incorporated in an amended system of national accounts?
Some of the major lines of research that are required are outlined below:
(1) Contingent valuation methods
CVM needs further methodological development and use. How can option and existence values, social services (e.g. bridewealth, conservation of sacred groves) and woodland service functions be incorporated in such analyses? Is it possible to obtain WTP bids directly about tree commodities, rather than using proxy commodities such as boreholes (as used by Lynam et al., in prep.). The actual meaning of the values solicited need investigation (Adamowicz, 1988; Adamowicz and Phillips, 1983; Bradley and Dewees, 1992) -- What are the appropriate forms of questioning? What does the value reflect: present utility or potential interventions?
Moyo et al. (1992) argue that willingness to pay may be better based on such questions as what monetary wage a communal area individual would be willing to accept in formal employment, or what income the individual would accept from his agricultural enterprises in order to forego reliance on tree cutting in preference for purchased formal sector substitutes. In this way, Moyo et al. (1992) argue, CVM will allow for consideration of entitlement and consumption patterns, not in situ, but in a dynamic long-term context.
(2) Willingness to pay
Valuation is based on willingness to pay (WTP), either as expressed in consumer's own preferences in conventional markets, or in hypothetical markets (as in CVM) (Bojo, 1993). Using the WTP concept raises four major problems: imperfect knowledge, externalities, skewed income distribution and market imperfections (Bojo, 1993; de Beer and Mcdermott, 1989).
While householders in the small-scale sector undoubtably have a wealth of 'indigenous technical knowledge' about trees and tree utilization, and act rationally in making resource use choices (Shepherd, 1992; Campbell et al., 1993), they are likely to be poorly informed about certain natural resource processes and are likely to undervalue off-site downstream impacts (externalities). To take an extreme example, they are unlikely to value woodland destruction in terms of its impact on global climate change.
It has been argued that WTP data are not only an expression of preference, but also reflect wealth and income distribution (Bojo, 1993). This is especially a problem in such countries as Zimbabwe, where income distribution is highly skewed. Even within the small-scale sector, there are wide differentials and skewed income distribution (Jackson 1989; Jackson and Collier, 1988; Moyo et al., 1992). There is a need to investigate the relationship between WTP and wealth, and a need to develop a system of weighting to ensure that the WTP of the wealthier sectors do not dominate any analysis (Bojo, 1993).
Markets do not necessarily reflect the true preferences or values of society where the property rights governing access to the resource are non-exclusive (Lynam et al., in prep.; Randall, 1983). In the smallholder sector in Zimbabwe, access to tree-based resources is a mixture of private and communal (Wilson, 1989; Nhira and Fortmann, 1993). Behnke (1985) has explored the shortcomings of valuation exercises in that they fail adequately to reflect the real value of some goods. Bradley and Dewees (1993) note that farm-gate prices and willingness to pay exercises may tend to over-value some commodities and undervalue others. Whether one is using actual or hypothetical markets there is a need to investigate the nature of willingness to pay estimates. What is the nature of demand functions? To what extent do market prices overestimate the value of products not commonly marketed or replacement products not frequently purchased? The relationship between WTP data and access roles also need investigation.
(3) Replacement production methodologies
Firstly, it is obvious that the major need is for better, more site-specific data to allow for detailed differentiated analyses (Scoones et al., 1992). The previous valuation was based on scattered bits of information from many systems throughout the country (Campbell et al., 1991b).
Production costs need to be incorporated in such analyses, particularly the labour costs. There is almost no data on labour required to exploit tree-based resources. The valuation of labour is problematic. For some activities, for instance craftwork, the net benefits would be negative if labour was given much value. On the other hand, labour inputs in the small-scale sector have often been underplayed or even ignored (de Beer and Mcdermott, 1989; Moyo et al., 1992; Southgate, 1988). Labour availability varies throughout the year, with severe bottlenecks in certain periods (Gumbo et al., 1989; Zinyama, 1988). Labour requirements for resource management need to be quantified, valued and incorporated into resource valuation.
The current examples of replacement-production methodologies have largely based the valuation on household consumption; the long term costs of changes in resource stocks have not been incorporated into the analyses (Moyo et al., 1992).
(4) From individuals to society
How can values assigned by individuals be weighed together to obtain an aggregate value which can guide social choice? (Blackorby, 1990; Bojo, 1993). In the first instance, research should compare how individuals assign value to commodity categories in comparison to the assignments of community groups and outside 'experts'. In this direction, the CVM described earlier included a comparison between the rankings of householders and experts (Campbell et al., 1991b). In general, there is a problem of scale, the wider the group of beneficiaries, the more difficult it is to obtain a valuation (Bojo, 1993).
In moving from the valuations of individuals to policy making, Moyo et al. (1992) argue for two approaches to be taken, termed the 'positivist' and 'normative' valuation approaches. They argue that the current valuation exercises have concentrated on the positivist approach, with valuation being based on current use patterns and the assumption that patterns of ownership, access and use of land and labour resources remain substantially unchanged. They argue that what is missing are any examples of valuation using a normative approach, in which policy makers are informed of the relative merits of different options of resource use entailing fundamental structural changes in the historical legacy of the present ownership and use. The two approaches involve different shadow pricing assumptions and a normative approach may preclude some methodologies such as CVM, which Moyo et al. (1992) argue rely on revealed preferences based on existing resource use, precluding valuation under alternative economic arrangements.
(5) Values in time and space
Generalised estimates of value and aggregate analyses are now available, but what is sorely needed is information that clarifies how value changes in time and space, in relation to such variables as season, year, environment, tenure, gender, wealth and age (Scoones et al., 1992; de Beer and Mcdermott, 1989). Valuation should tell us about changing uses of woodlands over time and about differential values amongst users. Most studies treat the rural population as an undifferentiated homogenous population: there are few studies of a micro-economic nature (Bradley and Dewees, 1993; Moyo et al., 1992).
(6) The cost of environmental change
Despite widespread concern about environmental degradation, it is clear that there is almost no valuation of environmental change in the region (see Southgate, 1988). The valuation of communal livestock systems by Scoones (1992a) did not take into account any potential degradation in the resource base and the replacement-production valuation of tree-based resources by Campbell et al. (1991b) did not incorporate any cost of the change in the resource base, as the estimates were mostly based on household consumption data: consume more and hence higher value! Hosier (1988) has provided a review of studies on the economics of deforestation in eastern Africa, but finds that only two studies have sufficient data to investigate the subject. He concludes that more information is needed about the resiliency of ecosystems to tree removal and more work is necessary to clarify the proper techniques to evaluate the economic implications of environmental change in developing countries. In the context of Zimbabwe, the cost of degradation is particularly important as the cost to the cost of not undertaking land reform and of not investing in the development of communal lands (Sam Moyo, pers. comm.; Katerere et al., 1991).
(7) Regional value of woodlands for service functions
There are almost no data on the ecological value of woodlands, apart from the CVM described above, which is based on a localized survey. What are the regional consequences of changes in tree cover? What is the value of the state forests in catchment conservation? Bojo (1993) argues that the changes in water flow patterns and/or changes in soil erosion and siltation should form the basis of such a valuation. For instance, as regards water the following techniques would be appropriate: (i) production valuation associated with changed water yields; (ii) contingent valuation on the consumers of water from rivers and dams, and (iii) valuation based on flood damage estimates. There is a vast source of largely unanalyzed hydrological data in Zimbabwe, on which to base valuation, but simulation models would probably also have to be used. As regards soil erosion and siltation, the following techniques need investigation: (i) loss of dam services due to siltation could be valued; (ii) soil loss and the resulting change in production could be investigated using simulation models such as SCUAF, though more empirical data are needed on the influence of trees on soil erosion.
(8) Global value of woodlands for biodiversity
There has been no attempts to value biodiversity in Zimbabwe or the region (Bojo, 1993). There is at least a need to make a preliminary valuation, but I concur with Bojo (1993) that biodiversity values are likely to be minor in comparison with other values. Some preliminary papers have discussed the methodological obstacles associated with the valuation of biodiversity (e.g. Bojo, 1993; Evenson, 1990; Haneman, 1988).
(9) Tourism
There is a need to make a more detailed analysis of the tourism industry, especially in regards the contribution of woodland systems to the benefits accrued.
(10) National accounting
It is clear from the above review of valuation that there has been no attempt to include changes in natural resource stocks in national accounts. There is recognition that the deficiencies in the national accounting system needs rectifying (Bojo 1993; Forestry Commission, 1990, p. 11; Katerere et al., 1991), but little attempt has been made to overhaul the present system. A fairly sophisticated example in which natural resources have been included in the national accounting system is that for Costa Rica (Tropical Science Center, 1991).
The International Development Research Centre (Canada) supports the current work on the valuation of tree-based resources at the University of Zimbabwe. I acknowledge the support of the Stockholm Environment Institute during the production of this paper.
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