Introduction: Lake Naivasha watershed is recognized for its contribution to Kenya's national gross domestic product from the export of horticultural products. Commercial horticultural investment downstream depends mainly on the Lake's water. The fresh water lake lacks surface outflow, and its recharge depends on river Malewa flowing from upper catchment in Aberdare ranges. However, unsustainable land use practices in the upper catchment has led to increasing sediment loading and pollution in river Malewa which affects water quality in the Lake downstream. Payment for Environmental Services (PES) scheme has been initiated as an alternative incentive approach to motivate upstream smallholder farmers adopt sustainable land use practices for conservation of watershed services. This paper analyzes willingness to accept pay (WTA) as proxy economic measure of environmental service (ES) value and determines socio-economic factors influencing farmers WTA for watershed conservation. We analyzed the WTA and characterized WTA underlying socio-economic determinants in two PES intervention sites in Kenya. Methods: The objective of this study was to estimate WTA and determine socio-economic factors influencing WTA. Semi-structured questionnaire was used to collect data from 200 PES farmers through face-to-face interview. We applied contingent valuation (CV) and logistic regression for data analyses to elicit farmer's WTA estimates to implement PES farm practices and determine socio-economic factors influencing WTA, respectively.

Designing and implementing biodiversity-based value chains can be a complex undertaking, especially in places where outcomes are uncertain and risks of project failure and cost overruns are high. We used the Stochastic Impact Evaluation (SIE) approach to guide the Intergovernmental Authority on Development (IGAD) on viable investment options in honey value chains, which the agency considered implementing as an economic incentive for communities along the Kenya-Somalia border to conserve biodiversity. The SIE approach allows for holistic analysis of project cost, benefit, and risk variables, including those with uncertain and missing information. It also identifies areas that pose critical uncertainties in the project. We started by conducting a baseline survey in Witu and Awer in Lamu County, Kenya. The aim of the survey was to establish the current farm income from beekeeping as a baseline, against which the prospective impacts of intervention options could be measured. We then developed an intervention decision model that was populated with all cost, benefit and risk variables relevant to beekeeping. After receiving training in making quantitative estimates, four subject-matter experts expressed their uncertainty about the proposed variables in the model by specifying probability distributions for them. We then used Monte Carlo simulation to project decision outcomes. We also identified variables that projected decision outcomes were most sensitive to, and we determined the value of information for each variable. The variable with the highest information value to the decision-maker in Witu was the honey price. In Awer, no additional information on any of the variables would change the recommendation to invest in honey value chains in the region. The analysis demonstrates a novel and comprehensive approach to decision-making for different stakeholders in a project where decision outcomes are uncertain.

PDF. Titles in the Working Paper series aim to disseminate interim results on agroforestry research and practices, and stimulate feedback from the scientific community. Other publication series from the World Agroforestry Centre include: Technical Manuals, Occasional Papers and the Trees for Change Series.

Natural resources provide a foundation for economic development today. However, global biodiversity is under threat due to among other things, increasing population over the years leading to an increased demand on natural goods and services such as fuel, timber and medicine. High demand for natural resources has led to increasing degradation of