between two agents without a specific production
cost for the externality issuer and without compensation for the final receiver. This is the case,
for example, with an agricultural practice that
generates an unintended effect on the landscape.
In this sense, Madelin (1995) identifies the positive action of agriculture on the environment as
a positive externality of production and thus as
an environmental service. Mahe (2001) does the
same thing when he speaks of “environmental
goods and services.” Taking externalities into
account and addressing the management of
environmental resources in an integrative manner
is the essence of the nexus approach (Hoff 2011).
The economic valuation of environmental
goods and the environment is mainly based on
methods that do not bring the environment back
to the state of a simple commodity that we can
buy or exhaust freely. It allows for providing an
element of comparison to more classical economic variables mobilized in the analysis of
decisions and political choices. Environmental
economists propose to determine the economic
value of the service provided to final users. They
have developed at least a tacit understanding
about the major categories of values to be considered in economic valuation (e.g., Brauer
2003). The total economic value is divided into
three broad categories of values: use values, nonuse values, and option values (Pearce and Markandya 1989; Pearce and Turner 1990; Tietenberg and Lewis 2008).
Using monetary value as a proxy for directuse value is relatively straightforward and
involves reliance on existing market prices. Nonmarket valuation can be used to quantify the
benefits of different conservation practices with
respect to off-site effects. The total economic
value of a resource can be measured using either
stated or revealed preference approaches. Given
the objectives of this study, revealed preference
techniques will be used to value the benefits of
avoiding off-site impacts.
The revealed preference method used in this
study relies on surrogate markets for environmental services to estimate monetary value based
on indirect use values (Chevassus-au-Louis et al.
2009). These are the methods in which agents’
choices and market prices serve as a basis for
evaluation. In this study, we use the damage
function approach (or dose–response function),
which first evaluates the damage in physical
terms and then monetizes it.
2 Materials and Methods
Exploring the interlinkages between resources
and advancing an integrated management
approach requires integrated modelling tools. For
implementing such tools there is a pressing need
for better disciplinary and interdisciplinary data.
The damage function described below, highlights
the interfaces, interactions, and fluxes between
resources (soil–water) and sectors (water, energy,
agriculture). This subsection aims to define data
and data sources and to explain the methodology
used to understand the interlinkages between
environmental resources and sectors.
2.1 Study Area and Data Source
The Lagdo watershed was chosen as a geographically specific area to measure the off-site
costs of erosion. The watershed covers approximately Cameroon’s North and Far North provinces. It covers an area of 10.2 million hectares,
of which 5.56 are cultivated. Its population of
nearly 5 million is predominantly rural (77.6%).
It is the cotton zone of Cameroon and while there
is a great diversity of landscapes and economic
activities, it is mainly focused on subsistence or
agro-industrial agricultural production (CEDC
2002). Two reasons made this area an appealing
choice. Firstly, the SSA contains many activities
that are known to be impacted by erosion. Secondly, severe erosion problems in certain areas
and under certain climatic conditions have
already been documented (Abou et al. 2006;
Ngondjeb et al. 2014). In the study area, soils are
constituted of discordant or alkaline granites and
alluvium with a sandy to loamy and sometimes
loamy-sandy texture. Their reduced surface clay
content, low organic matter and nitrogen content,
limited water holding capacity and slightly acidic
Economic Valuation of Environmental Services …
95
cost for the externality issuer and without compensation for the final receiver. This is the case,
for example, with an agricultural practice that
generates an unintended effect on the landscape.
In this sense, Madelin (1995) identifies the positive action of agriculture on the environment as
a positive externality of production and thus as
an environmental service. Mahe (2001) does the
same thing when he speaks of “environmental
goods and services.” Taking externalities into
account and addressing the management of
environmental resources in an integrative manner
is the essence of the nexus approach (Hoff 2011).
The economic valuation of environmental
goods and the environment is mainly based on
methods that do not bring the environment back
to the state of a simple commodity that we can
buy or exhaust freely. It allows for providing an
element of comparison to more classical economic variables mobilized in the analysis of
decisions and political choices. Environmental
economists propose to determine the economic
value of the service provided to final users. They
have developed at least a tacit understanding
about the major categories of values to be considered in economic valuation (e.g., Brauer
2003). The total economic value is divided into
three broad categories of values: use values, nonuse values, and option values (Pearce and Markandya 1989; Pearce and Turner 1990; Tietenberg and Lewis 2008).
Using monetary value as a proxy for directuse value is relatively straightforward and
involves reliance on existing market prices. Nonmarket valuation can be used to quantify the
benefits of different conservation practices with
respect to off-site effects. The total economic
value of a resource can be measured using either
stated or revealed preference approaches. Given
the objectives of this study, revealed preference
techniques will be used to value the benefits of
avoiding off-site impacts.
The revealed preference method used in this
study relies on surrogate markets for environmental services to estimate monetary value based
on indirect use values (Chevassus-au-Louis et al.
2009). These are the methods in which agents’
choices and market prices serve as a basis for
evaluation. In this study, we use the damage
function approach (or dose–response function),
which first evaluates the damage in physical
terms and then monetizes it.
2 Materials and Methods
Exploring the interlinkages between resources
and advancing an integrated management
approach requires integrated modelling tools. For
implementing such tools there is a pressing need
for better disciplinary and interdisciplinary data.
The damage function described below, highlights
the interfaces, interactions, and fluxes between
resources (soil–water) and sectors (water, energy,
agriculture). This subsection aims to define data
and data sources and to explain the methodology
used to understand the interlinkages between
environmental resources and sectors.
2.1 Study Area and Data Source
The Lagdo watershed was chosen as a geographically specific area to measure the off-site
costs of erosion. The watershed covers approximately Cameroon’s North and Far North provinces. It covers an area of 10.2 million hectares,
of which 5.56 are cultivated. Its population of
nearly 5 million is predominantly rural (77.6%).
It is the cotton zone of Cameroon and while there
is a great diversity of landscapes and economic
activities, it is mainly focused on subsistence or
agro-industrial agricultural production (CEDC
2002). Two reasons made this area an appealing
choice. Firstly, the SSA contains many activities
that are known to be impacted by erosion. Secondly, severe erosion problems in certain areas
and under certain climatic conditions have
already been documented (Abou et al. 2006;
Ngondjeb et al. 2014). In the study area, soils are
constituted of discordant or alkaline granites and
alluvium with a sandy to loamy and sometimes
loamy-sandy texture. Their reduced surface clay
content, low organic matter and nitrogen content,
limited water holding capacity and slightly acidic
Economic Valuation of Environmental Services …
95