Willingness to pay for forest conservation in Ecuador: Results from a nationwide contingent valuation survey in a combined "referendum" - "Consequential open-ended" design

Deforestation is a threatening pan-tropical problem. Net deforestation in Ecuador amounts to approximately 500 km2 per year for 2008–2014. It represents not only an environmental problem but also a threat to social welfare. As social welfare depends on individual preferences, we examined households´ preferences and willingness-to-pay (WTP) for a proposed forest conservation program aiming to avoid deforestation in Ecuador. Our study presents results from a nationwide contingent valuation survey conducted in a geographically stratified random sample of 976 households across the three main geographical regions of Ecuador as well as urban and rural areas. About 98% of surveyed households consider the proposed program worth supporting. For forest conservation, the monthly mean WTP per household lies between $6.28 (dichotomous choice) - $3.17 (open-ended) depending on the method of analysis indicating a solid potential for supporting incentive-based conservation programs. Households also expressed their preferences by regions and types of forests but our results are inconclusive in this regard. Methodologically, our study sheds some new light on the causes for the well-known discrepancy between dichotomous-choice and open-ended WTP estimates. Our results may help improving social welfare by incorporating households´ preferences into the design of forest conservation programs (e.g., like Ecuador's Socio Bosque program). Currently realized payments for the Socio Bosque program are based on sound social support which opens doors to discuss amplifying the financial scope of the program by examining the role that households could play in funding forest conservation programs. Our WTP estimates provide aggregate information that could support the design of forest policy instruments.