Effects of institutional distrust on value estimates of stated preference surveys in developing countries: a choice experiment on conserving biodiversity within agricultural landscapes in a biodiversity hotspot

Abstract

The use of stated preference surveys for the valuation of environmental goods in developing countries has to take into account that there is substantial public distrust towards institutions providing environmental goods under valuation. Thus, high protest responses and low-value estimates may indicate rejection/protest against the institutional setting of the survey, rather than the dislike or low welfare effects of these goods. In this context, we investigate the effects of institutional trust on value estimates by examining the performance of three different institutions—government, conservation NGO and farmers—in a case study aimed at eliciting preferences for conserving different types of biodiversity within orchards in the Cape Floristic Region—a biodiversity hotspot in South Africa threatened by the expansion and intensification of agriculture. We find that institutional trust has an effect on preferences and willingness-to-pay, with farmers leading to the highest level of trust and value estimates, followed rather closely by a conservation NGO and, with some distance, by the government with the lowest trust level and value estimates. In terms of preferences for biodiversity conservation, our results show that respondents prefer measures to conserve endangered and endemic species over measures primarily aimed at providing ecosystem services. For future studies in developing countries, we recommend selecting an institutional setting based on the study's purpose: institutions with high levels of trust should be prioritised for studies aiming to value a good per se, while existing institutions should be prioritised for studies valuing a policy to provide a good within an existing institutional framework.