A Contingent Valuation Survey and Benefit-Cost Analysis of Forest Preservation in East Gippsland, Australia

A contingent valuation survey was conducted to determine Victoriansʹ willingness to pay (WTP) to reserve unprotected East Gippsland national estate forests in national parks. Such reservation would preclude utilization of these forests for timber production. Attitudinal questions included in the survey revealed that Victorians consider the non-market values associated with these forests to be more important than market values. The median WTP per respondentʹs household for reserving the forests was $52, which corresponds to an annual aggregate non-market value to the people of Victoria of $41m. Data from a sub-sample of Gippsland residents indicated that people living in or adjacent to East Gippsland placed relatively more emphasis on market values and had a significantly lower WTP for reserving the forests. Using our contingent valuation result together with data from the Resource Assessment Commission, we calculated a positive net present value of $543m. for preserving the forests.