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Valuation of Wetland Attributes: An Application of Choice Experiment Approach: A Case Study of Lake Koka

Received: Aug. 13, 2019    Accepted: Sep. 11, 2019    Published: Jan. 04, 2020
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Abstract

Ethiopia has many lakes, the greater part of which is found in the Rift-valley, that are central for the development of economy of the country. One of these Lakes is Lake Koka, which is found inside the Ethiopian Rift Valley, and is an artificial lake built in 1960 to generate hydroelectric power. In spite of different advantages provided by Lake Koka, absence of powerful administration, uncontrolled irrigation, intensive agriculture and different human made activities has prompted to the degradation of the wetland. Human made activities such as, using wetland as waste disposal, over grazing, etc. aggravate the problems of the lake. To assign monetary values for the multi-functions and services offered by this Lake wetland ecosystem, this study applied choice experiment valuation method by identifying five attributes i.e. fish stock, biodiversity, water quality, availability of water and monetary payment. Multinomial logit, random parameter logit and latent class models were used to analyze the data collected from a sample of 200 respondents. The marginal willingness to pay for the improvement of water availability attribute is the highest which is birr 55 and it is significant at 1% level. Respondent’s willingness to pay for an increase in the level of water quality of Lake Koka and biodiversity from current situation of the lake, other things being constant, is birr 42 and birr 12 annually respectively. Respondents gave more value to the availability of water than biodiversity and water quality attributes.

DOI 10.11648/j.jim.20190805.11
Published in Journal of Investment and Management ( Volume 8, Issue 5, October 2019 )
Page(s) 76-85
Creative Commons

This is an Open Access article, distributed under the terms of the Creative Commons Attribution 4.0 International License (http://creativecommons.org/licenses/by/4.0/), which permits unrestricted use, distribution and reproduction in any medium or format, provided the original work is properly cited.

Copyright

Copyright © The Author(s), 2024. Published by Science Publishing Group

Keywords

Koka Lake, Choice Experiment, Multinomial Logit, Mixed Logit, Random Parameter Logit, Latent Class Model

References
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[21] Getnet. (2012). valuation of choke mountain wetland attributes. Addis Ababa University a Masters thesis.
[22] Hanley et al. (2001). Choice Modeling Approach: A superior Alternative for Environmental Valuation. Journal of Economic Surveys.
[23] Hanley, N., Wright, R., Adamowicz, V. (1998). Using Choice Experiments to Value the Environment: Design Issues, Current Experience and Future Prospects; Environmental and Resource Economics, 11 (3-4): 413-428. Kluwer Academic Publishers, Printed in Netherlands.
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  • APA Style

    Bulo Feyisa, Mekonnen Bersisa. (2020). Valuation of Wetland Attributes: An Application of Choice Experiment Approach: A Case Study of Lake Koka. Journal of Investment and Management, 8(5), 76-85. https://doi.org/10.11648/j.jim.20190805.11

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    ACS Style

    Bulo Feyisa; Mekonnen Bersisa. Valuation of Wetland Attributes: An Application of Choice Experiment Approach: A Case Study of Lake Koka. J. Invest. Manag. 2020, 8(5), 76-85. doi: 10.11648/j.jim.20190805.11

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    AMA Style

    Bulo Feyisa, Mekonnen Bersisa. Valuation of Wetland Attributes: An Application of Choice Experiment Approach: A Case Study of Lake Koka. J Invest Manag. 2020;8(5):76-85. doi: 10.11648/j.jim.20190805.11

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  • @article{10.11648/j.jim.20190805.11,
      author = {Bulo Feyisa and Mekonnen Bersisa},
      title = {Valuation of Wetland Attributes: An Application of Choice Experiment Approach: A Case Study of Lake Koka},
      journal = {Journal of Investment and Management},
      volume = {8},
      number = {5},
      pages = {76-85},
      doi = {10.11648/j.jim.20190805.11},
      url = {https://doi.org/10.11648/j.jim.20190805.11},
      eprint = {https://download.sciencepg.com/pdf/10.11648.j.jim.20190805.11},
      abstract = {Ethiopia has many lakes, the greater part of which is found in the Rift-valley, that are central for the development of economy of the country. One of these Lakes is Lake Koka, which is found inside the Ethiopian Rift Valley, and is an artificial lake built in 1960 to generate hydroelectric power. In spite of different advantages provided by Lake Koka, absence of powerful administration, uncontrolled irrigation, intensive agriculture and different human made activities has prompted to the degradation of the wetland. Human made activities such as, using wetland as waste disposal, over grazing, etc. aggravate the problems of the lake. To assign monetary values for the multi-functions and services offered by this Lake wetland ecosystem, this study applied choice experiment valuation method by identifying five attributes i.e. fish stock, biodiversity, water quality, availability of water and monetary payment. Multinomial logit, random parameter logit and latent class models were used to analyze the data collected from a sample of 200 respondents. The marginal willingness to pay for the improvement of water availability attribute is the highest which is birr 55 and it is significant at 1% level. Respondent’s willingness to pay for an increase in the level of water quality of Lake Koka and biodiversity from current situation of the lake, other things being constant, is birr 42 and birr 12 annually respectively. Respondents gave more value to the availability of water than biodiversity and water quality attributes.},
     year = {2020}
    }
    

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    T1  - Valuation of Wetland Attributes: An Application of Choice Experiment Approach: A Case Study of Lake Koka
    AU  - Bulo Feyisa
    AU  - Mekonnen Bersisa
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    JF  - Journal of Investment and Management
    JO  - Journal of Investment and Management
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    PB  - Science Publishing Group
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    UR  - https://doi.org/10.11648/j.jim.20190805.11
    AB  - Ethiopia has many lakes, the greater part of which is found in the Rift-valley, that are central for the development of economy of the country. One of these Lakes is Lake Koka, which is found inside the Ethiopian Rift Valley, and is an artificial lake built in 1960 to generate hydroelectric power. In spite of different advantages provided by Lake Koka, absence of powerful administration, uncontrolled irrigation, intensive agriculture and different human made activities has prompted to the degradation of the wetland. Human made activities such as, using wetland as waste disposal, over grazing, etc. aggravate the problems of the lake. To assign monetary values for the multi-functions and services offered by this Lake wetland ecosystem, this study applied choice experiment valuation method by identifying five attributes i.e. fish stock, biodiversity, water quality, availability of water and monetary payment. Multinomial logit, random parameter logit and latent class models were used to analyze the data collected from a sample of 200 respondents. The marginal willingness to pay for the improvement of water availability attribute is the highest which is birr 55 and it is significant at 1% level. Respondent’s willingness to pay for an increase in the level of water quality of Lake Koka and biodiversity from current situation of the lake, other things being constant, is birr 42 and birr 12 annually respectively. Respondents gave more value to the availability of water than biodiversity and water quality attributes.
    VL  - 8
    IS  - 5
    ER  - 

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Author Information
  • Department of Economics, Jinka University, Jinka, Ethiopia

  • Department of Economics, Ambo University, Ambo, Ethiopia

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