The thesis displays that smallholder farmers in the Global South have substantial willingness to pay for wide range of environmental goods and services, particularly for ecosystem services attributes related to their own agricultural production. The evidence from stated preference and field experiments also exhibit high loss aversion among the Ethiopian smallholder farmers.
Abrha Megos was born in Alamata, Tigray, Ethiopia in 1988. He holds a bachelor’s degree in Economics from Wolaita Sodo University, Ethiopia and MSc degree in Economics from Mekelle University, Ethiopia. He started his PhD study at the Norwegian University of Life Sciences, school of Economics and Business in 2014 under quota scholarship.
This dissertation complies four articles and maps preferences for climate change adaptation measures and ecosystem services among Ethiopian smallholder farmers; by analyzing their decision-making behavior under uncertainty in a framed field experiment, their stated preferences for ecosystem services, and factors motivating and constraining their preferences for these services and adaptation measures.
In the first article, the main objective was to investigate the decision-making behavior of smallholder farmers under hard uncertainty. Framed field experiment with real incentive is used to assess whether smallholder farmers adapt criteria that minimize loss in crop yield, minimize the maximum opportunity loss or maximize expected value when choosing prospects under hard uncertainty. Results show that choices of farmers depend on payment modes. Farmers make choices that minimize losses where there is a threshold limit to receive high value payment, and when uncertainty is high.
The second paper uses choice experiments on Ethiopian farmers to investigates whether developing country farmers value the improvements of river ecosystem services. Results show that the farmers have significant and positive willingness to pay for the improvements of river ecosystem attributes such as water supply reliability, flood protection, riparian vegetation, and water quality on nearby rivers, and they are willing to pay more for attributes particularly related with the improvement of provisioning services generated on their own farming. Farmers also reveal the highest demand for the improvements of flood protection measures, which implies high loss aversion.
The third paper reports on farmers´ preferences for improvements of coffee variety traits using choice experiments. The evidence show that farmers have stronger preferences for yield stability traits such as disease resistance and weather tolerance than for high yielding or early maturing traits. This implies that farmers give priority to coffee traits that give stable yield rather than increase yield in the face of environmental and weather stressors.
The fourth paper examines how environmental and climate change skepticism attitudes affect farmers´ preferences for increased forest conservation. The results reveal that high levels of environmental skepticism, such as believing that God causes climate change and that climate change discussions in the media are exaggerated. Environmental skepticism significantly reduces farmers´ likelihood of paying for forest conservation. On the other hand, farmers’ level of education and deforestation awareness increase their willingness to pay for improving forest conversation.
The thesis concludes the presence of high level of loss aversion among the smallholder farmers in the global south; farmers reveal stronger preferences for flood protections measures and stable yield coffee varieties such as weather tolerant and disease resistant traits and make choices that minimize losses under hard uncertainty. These farmers also have significant and positive willingness to pay for the improvements of river ecosystem services and forest conservation. Thus, with targeted measures reducing the risk of losses and promoting sustainable adaptation measures, smallholder farmers can be both the main custodians and beneficiaries of ecosystem services conservation in terms of increasing their long-run ability to adapt to climate change. This can contribute towards the countries’ endeavor to achieve the ambition of building a climate resilient green economy.