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Assessing the economic sustainability of managing protected areas using the CVM and CBA approaches

Dani Aoun (Faculty of Business Studies and Economics, Arab Open University, Beirut, Lebanon)

Management of Environmental Quality

ISSN: 1477-7835

Article publication date: 13 June 2016

406

Abstract

Purpose

The purpose of this paper is to design a preservation policy aimed at safeguarding the Ehden Natural Reserve, a reserve providing shelter to a substantial number of endangered species.

Design/methodology/approach

The current paper, offers an approach which merges contingent valuation and cost-benefit analysis (CBA) to design a preservation policy aimed at safeguarding the reserve. Contingent valuation is used to estimate the expected benefits from the reserve for both local residents and tourists visiting Ehden, while using a certainty analysis approach to explore the problem of hypothetical bias. A CBA is then applied to the findings to evaluate a ten year plan to preserve the protected area through a non-profit foundation.

Findings

Findings from the analysis support the feasibility of a project of this nature, which shows a positive NPV within the studied period and at an acceptable social discount rate (SDR). The balance between benefit and cost is thus always positive, except in some pessimistic cases when analyzing the sensitivity of the model’s critical variables, particularly the number of visitors, the different WTPs for visitors and locals and the different SDRs.

Originality/value

The paper adds to the scarce research available on the sustainability of protected areas in the Middle East region.

Keywords

Citation

Aoun, D. (2016), "Assessing the economic sustainability of managing protected areas using the CVM and CBA approaches", Management of Environmental Quality, Vol. 27 No. 4, pp. 374-389. https://doi.org/10.1108/MEQ-04-2015-0069

Publisher

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Emerald Group Publishing Limited

Copyright © 2016, Emerald Group Publishing Limited

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