Three Essays on Non-Market Valuation: Valuing the Billy Frank Jr. Nisqually National Wildlife Refuge

Anthony Good

Major Professor: Alex T Tabarrok, PhD, Department of Economics

Committee Members: Bryan Caplan, Noel Johnson

Online Location, #D150
April 15, 2020, 02:00 PM to 04:00 PM

Abstract:

The Nisqually Delta Restoration project began in 2009 with the removal of the Brown Farm Dike, inundating 308 ha of the Billing Frank Jr. Nisqually National Wildlife Refuge (Refuge) (Woo et al., 2011). In conjunction with the restoration of tribal lands by the Nisqually Indian Tribe in 1996, the Brown Farm Dike removal constitutes the single largest estuary restoration project in the Pacific Northwest (Woo et al., 2011). The sudden change in tidal flows resulting from the removal of the dike in 2009 augmented the landscape, which impacted the wetland’s ecological functions (e.g. nursery for juvenile salmon, carbon sequestration, and flood and flow control) and associated ecosystem services (e.g. nursery support for commercial fishing, climate change mitigation, and flood protection). In this dissertation, I use a suite of non-market valuation methods (i.e. benefit transfer, hedonic price, and production function) to determine the effect of the 2009 restoration project on the quantity, quality, and value of a subset of ecosystem services provided by the Refuge.

In Chapter 1, I provide an overview of the Refuge using an ecosystem services conceptual model (ESCM). The ESCM maps the linkages between direct and indirect drivers of wetland ecosystem change in the Refuge, changes to wetland ecological functions, and changes in the production of ecosystem goods and services provided by the Refuge. I also estimate a baseline value of nursery support for commercial fishing and carbon sequestration ecosystem services provided by the Refuge. The value of nursery support for commercial fishing is calculated using a benefit function transferred from Vedogbeton and Johnston’s novel commodity consistent meta-regression model (2020). I find that households in a 50km radius of the Refuge are willing to pay roughly $1 for a 1 percent increase in fish harvest. The value of carbon sequestration is estimated using carbon flux data over referenced and restored tidal marsh sites and various estimates of the social cost of carbon (SCC). My calculations suggest that the monetized damages associated with an incremental increase in one metric ton of carbon emissions each year is greatest in the reference marsh.

In Chapter 2, I estimate the effect of the 2009 Nisqually River Delta Restoration project on property values in Thurston and Pierce Counties in Washington, U.S.A. Economic benefits of the restoration project are estimated by comparing the marginal implicit price to live near the Refuge before and after the removal of the Brown Farm Dike. Restoration of the salt marsh habitat is likely to increase ecosystem services and may influence peoples’ marginal willingness to pay to live near the dike to enjoy the enhanced aesthetics, recreation, and other benefits of the ecosystem. To assess pre-removal and post-removal marginal willingness to pay, I use property sales data in Pierce and Thurston counties from 2005-2015 and a log-linear hedonic price regression model. The results indicate that the removal of the Brown Farm Dike improved services provided to local homeowners. The pre-removal marginal willingness to pay to live one foot closer to the Brown Farm Dike is -$0.69 (-$1,822 per ½ mile), while the post-removal willingness to pay to live a foot closer to the Brown Farm Dike site is -$0.55 (-$1,452 per 1/2 mile). This assessment indicates that the Nisqually Delta Restoration project increased the marginal willingness to live near the Brown Farm Dike site by $0.14 per foot ($370 per ½ mile). This analysis contributes to the growing body of literature by estimating the effects of a tidal marsh restoration project on housing prices and provides an indication of the ecosystem service value of natural resource management actions.

In Chapter 3, I employ a bioeconomics model to estimate the value of salmon habitat types in the Refuge. Wetland restoration projects have emerged as powerful tools for reinvigorating wetland productivity and mitigating climate change. The economic tradeoffs associated with wetland restoration are case dependent, which means an assessment of their economic viability needs to be conducted for each individual project. In the Nisqually River Delta, several tidal marsh restoration projects have been completed to improve ecosystem functionality, resulting in changes in salmon habitat. Changing habitat mosaics impacts the productivity of salmon by altering food availability, water characteristics, and opportunities to find shelter. I establish an empirical relationship between habitat capacity and habitat size found in rivers and streams in the Puget Sound and apply the empirical relationship to a bioeconomics model developed for this project. The bioeconomics model determines the direct use values attributed to freshwater tidal forests, transitional emergent marsh, emergent salt marsh, and intertidal delta mudflat in the production of commercial salmon fishing.