Management Theory and Studies for Rural Business and Infrastructure Development, Volume 36, Number 1

Determination of economic value of public goods in high nature value farming systems

Bernardas Vaznonis, Viana Petroliūnaitė, Anastasija Novikova

Abstract

High nature value farming systems not only maintain, but often recover biodiversity, which is the basis for existence of a viable ecosystem, at the same time securing the optimal amount of public goods for consumers. Ecosystem services are evaluated as positive effects from high nature value farming systems, because their features are comparable to public goods. The question is how the value of such environmental public goods can be determined and how their provision for society at the preferred level could be optimized. The aim of the research is to validate the most suitable methods for determination of economic value of public goods in high nature value farming  systems. For achieving the research aim the review of economic studies on determination of the value of agricultural public goods was done, the problems of determination of agricultural public goods value were analysed, the necessity of provision of public goods‘ regulation by economic value was substantiated, the relevance of methods for determination of economic value of public goods in high nature value farming systems were examined in the paper. The analysis has showed that the contingent valuation method, alternative cost evaluation methods and hedonic pricing techniques are mostly emphasized as specific methods, applied for determination of public goods from high nature farming systems. The analysis has showed that the contingent valuation and choice modelling are mostly emphasized as specific methods, applied for determination of public goods from high nature farming systems. Travel cost and real estate pricing methods are suitable only for evaluation of public goods related to recreation, leisure or culture.

JEL codes: Q51, Q57.

Keyword(s): high nature value farming systems, public goods, agriculture


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DOI: http://dx.doi.org/10.15544/mts.2014.015

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Management Theory and Studies for Rural Business and Infrastructure Development eISSN 2345-0355

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