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Economic Valuation of Riverside Wetland Services in the Lower Moshi Irrigation Scheme

Economic Valuation of Riverside Wetland Services in the Lower Moshi Irrigation Scheme

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We attempted to estimate the economic value of riverside wetland services in the Lower Moshi Irrigation Scheme in Tanzania. The Rau river water is the source of water for irrigation in the Lower Moshi irrigation Scheme. The Scheme is found in the Moshi Rural District in Kilimanjaro region about 20km from Moshi town. Over abstraction for irrigation water from the river, caused degradation of the riverside wetland. The conservation of riverside wetlands in the Rau river will provided by healthy riverside vegetation, fish and wildlife habitats, water purification, soil erosion control and recreation. The objective of this study was to estimate non marketed value of riverside wetland service provided by conservation of riverside wetland services in the Rau River in the LMIS in which contingent valuation survey in 105 households in the lower Moshi irrigation Scheme were administered. Respondents were given a current and hypothetical scenario and asked a willingness-to-pay (WTP) question regarding purchasing water for conservation of riverside wetland services through higher irrigation water fees. Results from 105 household interviewed indicated that households would pay an average of Tshs 27 860 per Ha per annum. WTP was found related to key variables suggested by economic theory and contingent valuation studies elsewhere: income, educational level, number of children in the household and initial bid amount. These results will allow decision makers to compare the benefits generated by different water uses, including riverside wetland services, and to manage scarce water resources under a long-term sustainable approach.
We attempted to estimate the economic value of riverside wetland services in the Lower Moshi Irrigation Scheme in Tanzania. The Rau river water is the source of water for irrigation in the Lower Moshi irrigation Scheme. The Scheme is found in the Moshi Rural District in Kilimanjaro region about 20km from Moshi town. Over abstraction for irrigation water from the river, caused degradation of the riverside wetland. The conservation of riverside wetlands in the Rau river will provided by healthy riverside vegetation, fish and wildlife habitats, water purification, soil erosion control and recreation. The objective of this study was to estimate non marketed value of riverside wetland service provided by conservation of riverside wetland services in the Rau River in the LMIS in which contingent valuation survey in 105 households in the lower Moshi irrigation Scheme were administered. Respondents were given a current and hypothetical scenario and asked a willingness-to-pay (WTP) question regarding purchasing water for conservation of riverside wetland services through higher irrigation water fees. Results from 105 household interviewed indicated that households would pay an average of Tshs 27 860 per Ha per annum. WTP was found related to key variables suggested by economic theory and contingent valuation studies elsewhere: income, educational level, number of children in the household and initial bid amount. These results will allow decision makers to compare the benefits generated by different water uses, including riverside wetland services, and to manage scarce water resources under a long-term sustainable approach.

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04/06/2013

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Economic Valuation of Riverside Wetland Servicesin the Lower Moshi Irrigation Scheme
Abstract:
We attempted to estimate the economic value of riverside wetland services in theLower Moshi Irrigation Scheme in Tanzania. The Rau river water is the source of water for irrigation in the Lower Moshi irrigation Scheme. The Scheme is found in the Moshi RuralDistrict in Kilimanjaro region about 20km from Moshi town. Over abstraction for irrigationwater from the river, caused degradation of the riverside wetland. The conservation of riverside wetlands in the Rau river will provided by healthy riverside vegetation, fish andwildlife habitats, water purification, soil erosion control and recreation. The objective of thisstudy was to estimate non marketed value of riverside wetland service provided byconservation of riverside wetland services in the Rau River in the LMIS in which contingentvaluation survey in 105 households in the lower Moshi irrigation Scheme were administered.Respondents were given a current and hypothetical scenario and asked a willingness-to-pay(WTP) question regarding purchasing water for conservation of riverside wetland servicesthrough higher irrigation water fees. Results from 105 household interviewed indicated thathouseholds would pay an average of Tshs 27 860 per Ha per annum. WTP was found relatedto key variables suggested by economic theory and contingent valuation studies elsewhere:income, educational level, number of children in the household and initial bid amount. Theseresults will allow decision makers to compare the benefits generated by different water uses,including riverside wetland services, and to manage scarce water resources under a long-term sustainable approach.
Keywords:
Contingent Valuation Method; Riverside Services; Willingness-to-Pay
Abiud January Bongole
 School of Business Studies and Economics,University of DodomaP. O Box 395, Dodoma, Tanzania
ISSN 2319-9725
 
March, 2013
www.ijirs.com
Vol 2 Issue 3
 
International Journal of Innovative Research and Studies Page 50
1.
 
Background:
This article addresses the economic value of various services provided by conservation of theRau river wetland in the Lower Moshi irrigation Scheme. The study used the ContingentValuation Method (CVM) to elicit the willingness to pay for the services provided by theriverside wetland in the Rau river in the Lower Moshi Irrigation Scheme (LMIS). Ecosystem products do have an economic value and can represent an important source of income for rural and urban communities (Speelman
 ,
2008). Riverside wetlands, for example, exhibitlarge diversity in size and shape, are complex and dynamic ecosystems that protect rivers bystoring nutrients and reducing sediment loads. Considerable progress needs to be made in thescience and art of river side wetlands development planning and management to conciliate production and conservation objectives (Kosz
 ,
1994).An increasing scarcity of water supply relative to demand has resulted into resourcecompetition, insufficiency water to support riverside wetland ecosystems, recreationalamenity and disputes among multiple users. Due to the increase of water resourcescompetition, the livelihoods of the poor and other vulnerable groups like women and childrenare highly insecure (Kadigi e
t al 
., 2006).According to a number of studies, water scarcity in the Lower Moshi Irrigation Scheme hasresulted into a severe deficit in water available for irrigation and conservation of riversidewetland services. As a result, water demands are not being met. Decreased instream flow of water in the Rau river causes poor conservation of the functions and services provided byriverside wetlands while the competition for water between upstream and downstreamfarmers has been increased (Turpie e
t al.
, 2003).This in turn requires a good understanding of the value of riverside wetland services and theimplications of water management for conservation of riverside wetland services (Johnsonand Baltodano
 ,
2004). In other words, decision makers and other stakeholders need to be precisely informed of the economic value of riverside wetland services if efficientmanagement and allocation of water resources are to be achieved (Kadigi
et al 
., 2006).The quantification of the value of irrigation water and riverside wetland services is arelatively new area of research, particularly in developing countries. Although studies byKadigi
et al.,
(2006), Tupie
et al.,
(2003) and Maganga (2001) among others have gone tolengths to estimate the economic value of irrigation water using Residual Imputation Method,
 
March, 2013
www.ijirs.com
Vol 2 Issue 3
 
International Journal of Innovative Research and Studies Page 51
much less attention has been paid in to measuring the economic value of ecosystem servicesin complex natural systems such as rivers using Contingent Valuation Method.This study estimated the non marketed value of riverside wetland services provided byconservation of riverside wetland services in the Rau River in the LMI
S.
The results of thisstudy will allow decision makers to compare the benefits generated by different water uses,including riverside wetland services, and to manage scarce water resources under a long-termsustainable approach.
 2.
 
Literature Review:
2.1 Economic Valuation of Wetland Services:
According to Loomis (1987) and Brander and Jane (2006) dollar values for in-stream flowscan often compare favorably against the value of water in traditional economically beneficialuses such as irrigation. While still relatively limited in number, attempts by ecological andenvironmental economists and other researchers to assess the monetary value of protectingin-stream flow and associated riparian areas to sustain several environmental services areincreasing.There are several techniques that can be used to value the benefits of improved ecosystemservices. The Non-market valuation approaches can be divided into two categories: revealed preference and stated preference methods.
2.2 Revealed Preference Methods
Revealed preference methods, also known as indirect valuation methods, look for related or surrogate markets in which the environmental good is implicitly traded (Birol and Phoebe,2006; Garrod, 1999). Information derived from observed behaviour in the surrogate marketsis used to estimate willingness to pay (WTP), which represents an individual's valuation of,or the benefits derived from, the environmental resource. Two such methods prevalent in theenvironmental economics literature are the hedonic pricing and the travel cost methods.These methods are suitable for valuing those water resources that are marketed indirectly andare thus only able to estimate their use (direct and indirect) values (Ojeda e
t al 
., 2008; Chiuehand Ming, 2008).The revealed preference methods include the Travel Costs, Replacement Cost, AvertiveExpenditures, Production Function Approach, Net Factor Income, Cost-of-Illness (COI), and

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