International Journal of

Environmental Research
and Public Health

Article
Resident Willingness to Pay for Ecosystem Services in
Hillside Forests
Wan-Jiun Chen 1 , Jihn-Fa Jan 2 , Chih-Hsin Chung 3 and Shyue-Cherng Liaw 4, *

1 Department of Economics, Chinese Culture University, No. 55, HawKang Rd., Taipei 111, Taiwan;
[email protected] or [email protected]
2 Department of Land Economics, National Chengchi University, No. 64, Section 2, Zhinan Rd.,
Taipei 116, Taiwan; [email protected]
3 Department of Forestry and Natural Resources, National Ilan University, No. 1, Section 1, Shennong Rd.,
Yilan City 260, Yilan County, Taiwan; [email protected]
4 Department of Geography, National Taiwan Normal University, No. 162, Section 1, Heping E. Rd.,
Taipei 106, Taiwan
* Correspondence: [email protected]; Tel.: +886-7749-1649

Abstract: This study investigated the willingness of residents to pay for ecosystem services in a
hillside forest in the Lanyang River Basin, which is among the most vulnerable watersheds in Taiwan.
The economic value of provisioning, regulating, cultural, and supporting ecosystem services was
evaluated. The Contingent Valuation Method (CVM) was applied for economic analysis of public
welfare. The determinants of the economic values were identified. A total of 444 respondents
completed the questionnaire. The results revealed that the four ecosystem services had high economic
value, indicating that conserving hillside forests can ensure the welfare of nearby residents. The
findings of this study can serve as reference for regional land planning and social and economic
system development policies. In addition, this study addressed policy implementation from the
Citation: Chen, W.-J.; Jan, J.-F.;
perspective of ecological economics to contribute to an improved Anthropocene.
Chung, C.-H.; Liaw, S.-C. Resident
Willingness to Pay for Ecosystem
Keywords: forests; ecosystem services; local industries; economic value; organic farming; contingent
Services in Hillside Forests. Int. J.
valuation method
Environ. Res. Public Health 2022, 19,
6193. https://doi.org/10.3390/
ijerph19106193

Academic Editors: Roberto Alonso 1. Introduction

González Lezcano, Francesco Nocera
Our planet is an ecosystem. The successive evolution of our world has transformed
and Rosa Giuseppina Caponetto
from an empty world to a full world, as defined by ecological economists [1–5]. It is
Received: 5 May 2022 possible to conceive that our world is highly developed; however, the planetary ecosystem
Accepted: 18 May 2022 and resources are finite. Because the economic system is a subsystem in the planetary
Published: 19 May 2022 boundary [6,7], the finite nature of Earth’s resources limits the economic growth.
Anthropocene is often used to represent the status quo of our current full world [8–11].
Publisher’s Note: MDPI stays neutral
with regard to jurisdictional claims in
In previous studies, Bennett et al. [9] suggested the needs of initiatives that can lead to a
published maps and institutional affil-
better Anthropocene, and McPhearson et al. [11] also point out radical improvements are
iations.
required for a better Anthropocene.
In philosophy, anthropocentrism refers to the belief that humans are the central or the
most significant entity in the world. In accordance with the anthropocentric viewpoint,
diverse functions performed under the circulation of the ecosystem directly or indirectly
Copyright: © 2022 by the authors. provide local residents with tangible or intangible benefits. The benefits obtained by in-
Licensee MDPI, Basel, Switzerland. dividuals from the ecosystem refer to ecosystem services. The Millennium Ecosystem
This article is an open access article Assessment (MEA) was conducted by the United Nations to examine the effects of changes
distributed under the terms and in the ecosystem on the well-being of humans. In the MEA, the relationship between ecosys-
conditions of the Creative Commons tem services and human well-being was determined by dividing ecosystem services into
Attribution (CC BY) license (https:// four aspects: provisioning, regulating, cultural, and supporting [12]. Provisioning services
creativecommons.org/licenses/by/
refer to material products that individuals obtain from the ecosystem, including food, fresh
4.0/).

Int. J. Environ. Res. Public Health 2022, 19, 6193. https://doi.org/10.3390/ijerph19106193 https://www.mdpi.com/journal/ijerph
Int. J. Environ. Res. Public Health 2022, 19, 6193 2 of 17

water, and biofuels. Regulating services refer to benefits obtained from physical, chemi-
cal, and biological processes in nature, including natural disaster control, carbon storage,
climate and water regulation, and pest and disease control. Cultural services are defined
as intangible and nonmaterial benefits provided by the ecosystem to humans, including
spiritual, aesthetic, educational, and recreational values and cultural diversity. Support-
ing services refer to indirect services provided by the biochemical cycles of ecosystems;
these services are necessary for the production of provisioning, regulating, and cultural
services, including fundamental processes that support soil formation, nutrient cycling,
photosynthesis, biodiversity, hydrology, and nutrient cycling on which humans are highly
dependent [12,13]. The multifaceted and critical functions of the ecosystem are highly
valuable and closely related to the well-being of individuals living in that ecosystem [14].
Only parts of these services are traded in the market system.
Direct benefits obtained by individuals from commercialized goods that are produced
from the ecosystem and traded services that are provided by the ecosystem can be clearly
determined. Moreover, the price in the trading systems usually serve as determinants and
the driving forces that guide people’s decisions in our society. However, the price in the
trading market system can only partially reflect the value of ecosystem services to humans.
That the values in the market trading system cannot represent the full value of ecosystems
to humans is proposed in the perspective of ecological economics [7].
In terms of environmental protection and conservation, if the value of each service
provided by the ecosystem cannot be clearly identified and quantified, the intangible value
that has not been quantified may be misunderstood and ignored in mainstream society,
resulting in the loss of crucial ecosystem services as a result of lacking awareness. Therefore,
scholars have clearly defined specific ecosystem services [12] and evaluated the value of
ecosystem services [7].
Because of the complexity of ecosystem services, existing market prices cannot pre-
cisely quantify their value. In the long-term pursuit of economic growth, mainstream
capitalized society has lost the balance between the natural society and human society,
neglecting the coexistence of the ecological environment. From the transdisciplinary per-
spective of ecological economics, after economic development for a certain period, the
world has transitioned from an empty world to a world full of humans and economic
activities [1,2]. The space for human life and economic activities has expanded from rela-
tively safe and flat land to hillside areas with extremely high environmental risks. Further
reclamation or development can increase the multifaceted risks of hillsides, resulting in
their increased sensitivity to extreme climate events such as heavy rainfall and floods.
The prioritization of income growth by mainstream society has reduced the necessity
and weakened the coercive and driving forces of environmental conservation and climate
adaptation by the government and relevant private sectors. Assessment of the economic
value of marketable and nonmarketable ecosystem services can help identify the value
indicators of the four ecosystem services. Moreover, the findings of such assessment can
guide the transformation of policies and strategies in the mainstream economy. On the
basis of anthropocentric philosophy, the economic valuation techniques developed in the
field of neoclassical economics. The assessment helps in guiding whether to conserve or
exploit nature for human well-being is based on the benefit to human beings [15].
The boundary between human society and nature is the critical frontier requiring
government intervention for mediation. Well-maintained forests in hillside areas enable
local residents to reap benefits from ecosystem services. Hillslope lands are vulnerable to
climate change and human activities [16,17]. Human disturbance can aggravate landslides
and water and soil pollutions [18]. These problems are especially acute in mountainous
areas in Taiwan.
Concerns regarding the conservation and protection of ecosystem services exist world-
wide, and land-use changes might hinder optimal use of local ecosystem services [19].
Land-use zoning generally serves as the basis for ecological plans [20]. The Taiwanese
government has planned land zoning on the basis of regional landscape characteristics in
Int. J. Environ. Res. Public Health 2022, 19, 6193 3 of 17

Taiwan [21]. By using the Lanyang River Basin in Yilan County as the study site, this study
evaluated the economic value of ecosystem services available in conserved low-altitude
hillside forest areas, which are classified by government land classifications.
Residents were interviewed, using a questionnaire survey, to determine their opinions
regarding the four ecosystem services (provisioning, regulating, cultural, and supporting)
provided by the adjacent forest on the low-altitude hillside of the Lanyang River Basin.
The benefits of the ecosystem services were determined using a five-point Likert scale, and
the economic value of the ecosystem services was determined using the single-bounded
dichotomous contingent valuation method.
The findings of this study can provide policy references for guiding the formula-
tion and promotion of local economic development strategies, enhancing local resilience
to future impacts, and reducing social and economic damage caused by inappropriate
land use.

2. Materials and Methods

2.1. Study Site
The climate in Taiwan ranges from tropical to subtropical. Being surrounded by sea,
Taiwan frequently experiences seasonal monsoons and severe typhoons in summer and
autumn. Climate change has resulted in extreme rainfall, drought, and strong winds.
In Taiwan, the mountains are high and steep, and the coastal plains, occupying a small
area, are densely populated. The marginal land area is rich in natural resources. Prudent
land classification and corresponding zoning to preserve forests and prevent disasters
have resulted in the regulation of land use and protection of vulnerable hillside areas.
Furthermore, the intervention of the government to limit the development of sloping land
resources and protect steep slopes from large-scale disasters has improved the conservation
of soil and water, the integrity of the overall ecosystem of the sloping land, and the
protection of existing ecosystem services in hillside areas.
The impact of climate change has caused an increase in the frequency of extreme
climate events and changes in the distribution patterns of high temperature and rainfall.
The United Nations Intergovernmental Panel on Climate Change (IPCC) synthesized the
latest research in various academic fields in the 2019 Special Report on Climate Change
and Land [22], discussing climate change, land degradation, sustainable land management,
food security, and greenhouse gas fluxes in terrestrial ecosystems. In the report, the IPCC
indicated that more than a quarter of the world’s land is facing the risk of degradation
and that climate change continues to intensify; thus, strengthening the protection and
restoration of forests is a key solution to prevent land degradation and disasters [22].
Extreme weather events resulting from climate change often cause substantial damage
in many areas of Taiwan, especially land and rock disasters on slopes caused by high-
intensity typhoon rainfall. Global warming has caused extreme climate uncertainty, changes
in precipitation patterns, and drought and flood problems. Moreover, unusual weather
caused by climate change is frequently reported in Taiwan and worldwide, breaking
meteorological records and posing a considerable threat to a country’s social economy,
individuals, and property. Thus, responding to catastrophic weather has become a crucial
problem in terms of national security. Uncertainty regarding climate such as uneven rainfall
in the monsoon and typhoon seasons poses a particular challenge to Taiwan’s slope land
areas [23–26].
The gradual movement of some agricultural activities from plains to mountainous
areas would exacerbate the fragmentation of the hillside landscape. Moreover, this sit-
uation would result in the hillside and its ecosystem being divided into scattered units,
thus reducing the services of the ecosystem and increasing the complexity of hillside dis-
asters. Therefore, determining the value of the ecosystem services that can be destroyed
by natural disasters caused by climate change is essential, especially in the context of
misleading policies or poor preparation for mitigating future climate change. However,
low-altitude hillside areas, which are located at the critical interface between man and
 Int. J. Environ. Res. Public Health 2022, 19, 6193 4 of 17

nature, are directly affected by human activities. Because of climate change, fruits and
vegetables are increasingly being cultivated in more temperate, cooler, and well-drained
mountainous areas [27,28]. The optimal temperature for the growth of cabbage, which is
widely cultivated in Taiwan, is approximately 20 ◦ C. However, cabbage grows slowly and
its taste is negatively affected during high temperatures in summer that exceed 30 ◦ C. Un-
favorable conditions resulting from climate change has forced the movement of agriculture
to mountainous areas [27,28].
Against the backdrop of potential threats and crises, the sustainable management of
the ecosystem in mountainous areas has become crucial. Determining the economic value
of the ecosystem services provided by forests to residents can inform the development of
policies to manage possible changes in the relationship between humans and nature in
the future.
The Lanyang River Basin is located in Yilan County, northeastern Taiwan, and covers
plains and high mountainous areas. This basin is rich in biodiversity and is a crucial
area for agricultural production and recreational activities. The Lanyang River Basin
frequently experiences strong winds, torrential rains, and typhoons, which adversely affect
the ecosystem and environment. Climate change, extreme weather events, typhoons, and
torrential rain may lead to the loss of soil and water resources and the destruction of
sloping animal and plant habitats, posing a potential threat to the ecosystem services. In
Taiwan, Yilan County is among the areas most affected by typhoons and is thus
Int. J. Environ. Res. Public Health 2022, 19, x FOR PEER REVIEW a suitable
5 of 18
representative research area for investigating the impact of climate change on hillsides.
By using the Lanyang River Basin as the research area (Figure 1), this study analyzed
the current economic value of the ecosystem services in low-altitude hillside areas to provide
basic background knowledge for the management and adjustment of catchment areas.

Figure 1. Study site: Sanshing Township (SST), Yuangshan Township (YST), and Dongshan Township
Figure(DST)
1. Study site:
in Yilan Sanshing
County, Township (SST), Yuangshan Township (YST), and Dongshan
Taiwan.
Township (DST) in Yilan County, Taiwan.
Three of Yilan County’s 12 townships are located at a lower altitude, a conjunct area
2.1.1. SST
between the Lanyang Plain and mountains, and residents live in the vicinity of the hillside.
Twoistownships
SST located to are
the located
west of high on the watershed.
the Lanyang Plain. ThisThe remaining
township townships
contains are located
many plains
close to the sea and have active economic activities.
and river networks; the rocks and sand coming down from the fragile mountainous area are
accumulated In this study, theThe
in riverbeds. three townships
land located
SST is located onatwas
lowformed
altitude were investigated:
following the creationSanshing
of
Township (SST), Yuangshan Township (YST), and Dongshan
a large sandbar in the creek bed of the Lanyang River. In the past, SST was Township (DST). These
subject to three
townships
frequent are geographically
river flooding, locatedarrived
and new residents at the intersection
to reclaim theof mountains and plains,
land. This township is with
areas of by74.77, 133.69, anddamage,
78.02 km 2 , respectively,
characterized frequent flood and the principalandcropspopulation
were rice, densities of 21,221,
peanuts, and
32,177,
sugarcane. and 52,954, respectively. In the following subsections, the basic characteristics of
SST is prone to flooding due to its geographical location. Moreover, individuals of
multiple ethnic groups reside in SST. Trade mainly occurs between individuals living in
mountainous areas and individuals living on the plains. Thus, SST has been a crucial place
for multiethnic and cultural fusion since ancient times and a place of ethnic and cultural
conflicts and trade.
Int. J. Environ. Res. Public Health 2022, 19, 6193 5 of 17

these three townships are described on the basis of information provided by Yilan County
Government, Taiwan [29].

2.1.1. SST
SST is located to the west of the Lanyang Plain. This township contains many plains
and river networks; the rocks and sand coming down from the fragile mountainous area
are accumulated in riverbeds. The land SST is located on was formed following the creation
of a large sandbar in the creek bed of the Lanyang River. In the past, SST was subject
to frequent river flooding, and new residents arrived to reclaim the land. This township
is characterized by frequent flood damage, and the principal crops were rice, peanuts,
and sugarcane.
SST is prone to flooding due to its geographical location. Moreover, individuals of
multiple ethnic groups reside in SST. Trade mainly occurs between individuals living in
mountainous areas and individuals living on the plains. Thus, SST has been a crucial place
for multiethnic and cultural fusion since ancient times and a place of ethnic and cultural
conflicts and trade.
In recent decades, floods have become less frequent due to intervention by the gov-
ernment, and ethnic conflicts between aboriginal and Han people have been minimized
following ethnic diffusion; however, the stagnation of social and economic development
has prompted the exodus of many residents. Villages are now home mostly to older people
and children. However, due to dedicated agricultural development in SST in the last two
decades, it has attracted attention for its high-quality agricultural produce. The cultiva-
tion of green onion, garlic, silver willow, and pear has provided economic benefits to the
residents and improved their lives.

2.1.2. YST
YST is mostly a hilly area with a beautiful landscape. The sloping topography and
climatic conditions of YST are suitable for the cultivation of various crops such as tangerines,
pineapples, bamboo shoots, ginger, starfruit, leeks, guava, lotus mist, shallots, and pears.
The green hills and fruit fields are particularly suitable for the promotion of agricultural
recreational activities. Fruit picking services are provided during the ripening season.

2.1.3. DST
DST is mostly a hilly area, and tea plants and fruits are mainly cultivated in this
area. In DST, agriculture is actively transforming into precision farming to promote local
agricultural recreational activities, including tea gardens, local food restaurants, and sight-
seeing orchards. Tea is the most popular agricultural produce. With the efforts of local
farmers’ associations, the cultivation of local specialty products, such as tea, pears, pomelo,
peach, and yam, is promoted. Agricultural recreational activities involve recreational forest
trails in mountainous areas and visits to waterfalls, lakes, flood diversion weirs, and tree
seedling nurseries.

2.2. Methodology
In Taiwan, because of high mountains with steep slopes, short rivers, rapid instream
flow, and heavy rainstorms, dangerous hillsides and geologically fragile zones are challeng-
ing to exploit. However, long-term soil conservation practices have effectively protected
hillside forest areas.
The hillside forest ecosystem provides ecosystem services for local residents, and the
contingent valuation method based on consumption theory can be used to estimate the
economic value of marketable and nonmarketable goods [30]. The economic value can be
used as an indicator to reflect the economic value of the ecosystem services [31,32].
This study evaluated the economic value of the ecosystem services of the hillside areas
of the Lanyang River Basin forest to local residents.
Int. J. Environ. Res. Public Health 2022, 19, 6193 6 of 17

Ecosystem services provide both marketable and nonmarketable benefits, and their
value cannot be fully and directly presented in the trading market. To determine the com-
plete economic value of the four specific ecosystem services for residents, with the aim of
facilitating government decision-making, this study used the single-bounded dichotomous
contingent valuation method. This study established a hypothetical market in which re-
spondents needed to indicate their willingness to pay a certain amount for a given service.
The economic value of the ecosystem services was analyzed using the single-boundary
dual-condition evaluation method. This quantitative analysis can help identify factors that
affect the willingness to pay for services and the relevant amount; this information can be
beneficial for formulating relevant policies.

2.2.1. Contingent Valuation Method

The contingent valuation method is an application of stated preference that involves
(1) establishing a hypothetical market for target goods or services to be evaluated, (2) elicit-
ing values by directly asking stakeholders, and (3) calculating the economic value of the
target goods or services based on the theory of welfare economics. This method is used to
evaluate various goods and services and is often used to examine nonmarketable goods
and services. In the hypothetical market, various elicitation methods are used in the ques-
tionnaire. To simulate the real purchasing pattern in the exchange market, closed-ended
questions are preferred over open-ended questions. Cameron and James [33] indicated
that the single-bounded method with close-ended questions is efficient. The binary choice
method is regarded as an ideal method. The estimation process for dichotomous choices is
widely applied for evaluating environmental goods and services [34].
In binary selection, if a series of higher or lower bidding amounts remain after the
first binary selection, the single-bounded dichotomous method is extended to make it
double-bounded, triple-bounded, and so on. The aforementioned methods have been
compared in various empirical studies [35–38]. Boyle et al. [39] used the single-bounded
method, whereas Kumaraswamy [40], Sundar and Subbiah [41], Kanninen [42], Yoo and
Yang [43], and Yoo and Kwak [44] have used the double-bounded method. Langford,
Bateman, and Langford [45], Bateman et al. [46], and Carson and Hanemann [38] have used
triple-bounded dichotomous questions. Moreover, studies have discussed the limitations
and solutions of the use of these methods [47–49] in terms of bias during the survey and
the respondent’s psychological behaviors.
Although the increase in the bidding time in a questionnaire would shorten the interval
used to estimate economic values, Hanemann et al. [50] theoretically verified that the
estimation results of the double-bounded method were more statistically efficient than those
of the single-bounded method. However, an increase in the bidding time would increase
the complexity and difficulty in processes at both the stages of practically interviewing
respondents and technically estimating the average willingness to pay. Increasing the
number of the bidding inquiries involving binary choices would reduce the marginal
efficiency of estimation [51].
The single-bounded dichotomous evaluation method has been employed to examine
the economic value of ecosystem services in empirical studies [52–55] due to the simplicity
and efficiency of the interview and analysis processes, despite considerable discussion
of potential problems since its early use by Bishop, Heberlein, and Kealy [56]. Moreover,
the evaluation has significance in the empirical application in ecology assessment [57–60].
Gould et al. [55] had indicated that the ecosystem services research and evaluations can
advance ecological economics principles. Hence, the contingent valuation method remains
useful for identifying environmental and ecological value indicators.

2.2.2. Residents and Respondents

In this study, local residents were regarded as critical stakeholders because they
directly received the ecosystem services from the hillside forest. The residents’ views
on the economic value of the ecosystem services in the constructed hypothetical market
Int. J. Environ. Res. Public Health 2022, 19, 6193 7 of 17

were explored in this study. The residents’ willingness to pay for conserving the current
ecosystem services generated from the forest present in the vicinity was evaluated.

2.2.3. Eliciting Process

A closed-ended questionnaire with a single-bounded dichotomous choice method
was used to elicit the willingness of respondents to pay for the service. This method is
similar to the ordinary trading behavior of individuals in the market, and the answering
of questions is easier for respondents in this method. Respondents were required to
simply indicate whether they were willing to pay the assigned amount provided in the
questionnaire. The following question was asked to the respondent: “With the knowledge
that the present ecosystem services will be destroyed one day, would you be willing to pay
$ Ai 0 to conserve your current ecosystem services now?” The dichotomous choices to be
selected were “willing” or “unwilling” to pay. Such questions involving a binary response
correspond to the single-bounded discontinuous contingent valuation method. If the ith
response is “yes,” the i-th respondent’s real willingness to pay (Ai ) would be in the range
(Ai 0 , ∞); if the response is “no,” Ai would be in the range of (0, Ai 0 ).

2.2.4. Embedding Effect

The embedding effect occurs when parts of inseparable mosaics are estimated. This
effect is observed when commodities are analyzed on the basis of their characteristics [61].
When the economic value of an individual service is analyzed, the embedded effect
is likely to occur because the four ecosystem services are simultaneously generated from
the ecosystem and are not independent commodities. The ecological circulating and
functioning systems for the four ecosystem services classified by MEA [12] are not mutually
exclusive. The provisioning, regulating, culture, and supporting ecosystem services cannot
be separate.
Although these services can be estimated separately, the overall ecosystem value
cannot be represented by the linear addition of estimated individual values because of the
presence of unknown intangible and complex interconnections in the system and between
them. The four ecosystem services are embedded in each other. Thus, this study analyzed
the economic benefits of the four ecosystem services individually.

2.2.5. Payment Channel

A payment was asked for the ecosystem services to conserve the well-protected hillside
forest. A well-designed payment method can promote and affect the willingness to pay
and the estimated economic value of a service. In terms of payment methods, residents
could use conservation funds from the local community. In addition, government taxations
are usually regarded as a lump sum amount already paid for all general public services,
and the inclusion of this payment channel in questionnaires tends to evoke protesting and
invalid responses [62].

2.2.6. Estimation Procedure of the Single-Bounded Method

This study used the single-bounded method reported by Hanemann [30] to estimate
the economic value. The economic value was estimated by fitting questionnaire data to the
binary logit function. The logit function is as follows:
  −1
P(Y ) = 1 + exp−( β0 + β1 A+ XΦ)+e (1)

where P(Y) is the probability of the respondent saying “yes;” A is the bidding value;
X is a vector of independent variables including the demographic characteristics of re-
spondents; β 0 , β 1 , and Φ are parameters; and e is the random error. Estimation of the
logistic model requires random errors, implying the presence of incomplete knowledge on
respondents’ preferences.
Int. J. Environ. Res. Public Health 2022, 19, 6193 8 of 17

The point estimate of the economic value was calculated with reference to the studies of
Cameron [34,63] and after performing logistic regression (1) and determining the estimated
coefficient of the bidding variable βˆ1

E(WTP) = −1/ βˆ1 (2)

2.2.7. Pilot, Bidding Values, and Survey

To collect information on residents’ opinions and willingness to pay for the four
ecosystem services, an on-site questionnaire survey was performed during August 2021 in
SST, YST, and DST. The survey interviews were performed at the township office, post office,
train station, and farmers’ association of these townships. A total of 450 residents were
randomly selected, of whom 90, 136, and 224 were from SST, YST, and DST, respectively;
the number of the township residents depended on the total population of each township.
A total of 444 respondents completed the questionnaire, of whom 89, 136, and 219
were residents of SST, YST, and DST, respectively.
The overall bidding range and the seven bidding values were determined on the
basis of WTP from the pilot by assuming that the population distribution of WTP could be
reliably derived from the pilot survey. The five bidding values were 250, 500, 1000, 2000,
and 3000 New Taiwan dollar (NTD), and they were randomly assigned to the respondents
in the survey.
The bidding value was set at 250, 500, 1000, 2000, and 3000 NTD in accordance with
the findings of the pilot survey conducted from July to August 2021. In the pilot survey,
50 residents were asked an open-ended question to determine their willingness to pay for
conserving current ecosystem services in the hillside forest. The bidding values in the final
survey represent the 20th, 30th, 50th, 70th, and 80th percentile (P20, P30, P50, P70, and P80,
respectively) of the amount indicated in responses to the open-ended question in the pilot
survey (Table 1).

Table 1. Means and percentiles of the pilot survey.

Ecosystem Services Provision Regulation Culture Support

number of respondents n = 50 n = 50 n = 50 n = 50
mean 2269 2389 1927 2460
percentile
P20 211 223 500 223
P30 284 440 500 440
P50 1000 1000 1000 1000
P70 2000 2000 2000 2000
P80 3000 3000 3000 3000
Unit: New Taiwan Dollar.

On the basis of the theoretical principle of welfare economics, utility occurs when
an individual consumes a commodity or enjoys a service and is willing to exchange the
benefit for a monetary amount. The welfare of the consumer can be calculated by following
the principle of consumer theory. This study established a hypothetical market, and the
residents were asked if they are willing to pay a bidding amount each year.
The bidding amounts of 250, 500, 1000, 2000, and 3000 NTD were randomly assigned to
the questionnaire items. That is, the respondents simply responded to the value provided in
the questionnaire item; they did not choose a specific bidding amount for each questionnaire
item. The results of the survey, the statistics of responses to different bidding amounts, and
the estimated economic value are reported in the next section.

3. Results
3.1. Residents’ Agreement with the Ecosystem Services
In the survey, the opinions of the residents regarding the ecosystem services provided
by the nearby hillside forest were investigated. The interviewed residents exhibited high
Int. J. Environ. Res. Public Health 2022, 19, 6193 9 of 17

agreement with statements regarding the hillside forest ecosystem’s ability to provide the
provisioning, regulating, cultural, and supporting ecosystem services (Tables 2 and 3).

Table 2. Residents’ opinion regarding the ecosystem services provided by the hillside forest.

Likert Scale 5 4 3 2 1 Total

Ecosystem services
236 161 34 10 3 444
provision
(53.15) (36.26) (7.66) (2.25) (0.68) (100)
289 137 14 3 1 444
regulation
(65.09) (30.86) (3.15) (0.68) (0.23) (100)
247 164 25 8 0 444
culture
(55.63) (36.94) (5.63) (1.8) (0.00) (100)
254 161 26 2 1 444
support
(57.21) (36.26) (5.86) (0.45) (0.23) (100)
Note: This table illustrates the number and percentage (in parentheses) for a total of 444 respondents. A 5-point
Likert-type scale was used to measure the agreement of the residents with statements regarding the ecosystem
services provided by the low-latitude forest in the vicinity. The responses for the 5-point scale were strongly agree,
agree, neutral, disagree, and strongly disagree for the scores of 5, 4, 3, 2, and 1, respectively.

Table 3. Residents’ opinions regarding the ecosystem services (by township).

SST YST DST

Township
(n = 89) (n = 136) (n = 219)
Likert Scale 5 4 3 2 1 5 4 3 2 1 5 4 3 2 1
Ecosystem services
55 29 5 0 0 79 50 5 1 1 102 82 24 9 2
provision
(12.39) (6.53) (1.13) (0.00) (0.00) (17.79) (11.26) (1.13) (0.23) (0.23) (22.97) (18.47) (5.41) (2.03) (0.45)
60 25 3 1 0 96 36 3 0 1 133 76 8 2 0
regulation
(13.51) (5.63) (0.68) (0.23) (0.00) (21.62) (8.11) (0.68) (0.00) (0.23) (29.95) (17.12) (1.80) (0.45) (0.00)
50 35 4 0 0 80 41 10 5 0 117 88 11 3 0
culture
(11.26) (7.88) (0.90) (0.00) (0.00) (18.02) (9.23) (2.25) (1.13) (0.00) (26.35) (19.82) (2.48) (0.68) (0.00)
56 27 5 0 1 80 52 4 0 0 118 82 17 2 0
support
(12.61) (6.08) (1.13) (0.00) (0.23) (18.02) (11.71) (0.90) (0.00) (0.00) (26.58) (18.47) (3.83) (0.45) (0.00)
Note: This table illustrates the number and percentage for a total of 444 respondents.

3.2. Response Statistics of Different Bidding Amounts

The different bidding amounts were distributed evenly (Table 4).

Table 4. Even distribution of the bidding amount in the three townships.

Townships SST YST DST Total

Bid Number % Number % Number % Number %
250 18 20.22 28 20.59 42 19.18 88 19.82
500 17 19.10 27 19.85 42 19.18 86 19.37
1000 18 20.22 27 19.85 45 20.55 90 20.27
2000 18 20.22 27 19.85 45 20.55 90 20.27
3000 18 20.22 27 19.85 45 20.55 90 20.27
sum 89 100.00 136 100.00 219 100.00 444 100.00

The interviewees were asked to indicate if they were willing to pay the assigned
bidding amount. Respondents answered “yes” if their valuation of the ecosystem service
was higher than the bidding amount and “no” if their valuation was lower than the amount
asked. Table 5 presents the statistical data of the respondents’ responses; the number
of positive responses slightly declined with the increase in the bidding amount in the
three townships.
Int. J. Environ. Res. Public Health 2022, 19, 6193 10 of 17

Table 5. Agreement to pay the corresponding bidding amount.

Provision Regulation Culture Support

Number of Number “Yes” Number “Yes” Number “Yes” Number “Yes”
Bid % % % %
Respondents Response Response Response Response
250 88 52 59.09 54 61.36 47 53.41 51 57.95
500 86 45 52.33 48 55.81 45 52.33 45 52.33
1000 90 47 52.22 47 52.22 44 48.89 46 51.11
2000 90 37 41.11 35 38.89 36 40.00 36 40.00
3000 90 32 35.56 32 35.56 29 32.22 32 35.56
Sum 444 213 216 201 210
(%) (47.97) (48.65) (45.27) (47.30)

The results indicated that 60.67%, 58.82%, and 55.71% of the residents of SST, YST, and
DST were willing to pay. Most of the respondents strongly agreed with the value of the
ecosystem services provided by the hillside forest in the Lanyang River Basin. Nearly half
of the respondents expressed that they were willing to pay the bidding amount.

3.3. Determinants of Residents’ Willingness to Pay

This study performed logit regression to analyze the determinants of the residents’
willingness to pay for the randomly assigned bidding amount. On the basis of the estimates
of logit regression, the economic value of the ecosystem services was calculated by following
Cameron [34]. The dependent variable P(Y) was the binary responses of the residents in
the single-bounded contingent valuation method and calculated as follows:
 
P(Yi ) = f BIDi , AGREEEEi , GENDERi , OCCUDPUBLIC , STAYHRi , AGED60i ∗ I NCD30i , I NC10Ti , DONDi + µi (3)
i

where µ is the residual and subscript i represents the ith respondent. Table 6 presents
the definitions of the variables included in this regression and their descriptive statistics.
In addition to the bidding variables, demographic variables have high accessibility and
are often used as regressors. Other variables, namely the individual agreement with the
value of the ecosystem services offered by the forest, length of stay per visit to represent
the personal interaction with the hillside forest, and history of monetary donation for
environmental protection, were included in logistic regression. The degree of the agreement
of the respondents with statements regarding the value of the four ecosystem services
was measured using a five-point Likert scale. Because the five points used in the Likert
scale were not equidistant, its arithmetic mean is not indicated in the statistics in Table 6.
Monetary donation for environmental protection, which is an actual economic response
action, was included as a regressor.
Table 7 lists the estimated results of logistic regression. The extrapolation and interpo-
lation results indicated significant variables in logistic regression. The variables listed in
Table 7 were examined using the chi-square test and Student’s t test, and high collinearity
was not observed between the explanatory variables. The chi-square test was used to exam-
ine associations between categorical variables, and Student’s t test was used to determine
correlations between continuous variables. The determinants were determined on the basis
of the estimates in Table 7.
In the estimated logit regression model, the bidding amounts assigned to the re-
spondents (variable BID) were significantly negatively correlated with the four ecosystem
services. The willingness to pay tended to decrease with the increase in the bidding amount.
However, the bidding amount was not the only significant variable.
The willingness to pay increased with agreement regarding the value offered by the
hillside forest in terms of the four ecosystem services.
Int. J. Environ. Res. Public Health 2022, 19, 6193 11 of 17

Table 6. Definitions of variables.

Mean (S.D.)
Variable Definition
SST YST DST Total
Binary dependent variable, used to represent the
P (Y ) willingness to pay. In the survey, if the respondent - - - -
indicated “yes”, P(Y) = 1; otherwise, it is 0.
C Constant - - - -
BID The bidding value (New Taiwan dollar, NTD) - - - -
AGREEEE Agreement with the ecosystem services. * - - - -
Gender dummy,
0.56 0.52 0.45 0.50
GENDER 1, if female
(0.50) (0.50) (0.50) (0.50)
0, if male
Occupation dummy,
1, those who do not directly depend on local resources
0.11 0.10 0.09 0.10
OCCUDPUBLIC for their livelihood, such as those in the military, civil
(0.32) (0.31) (0.29) (0.30)
service, and education sector;
0, otherwise.
1.76 1.78 1.79 1.78
STAYHR Average length of stay per visit (hours)
(1.12) (1.16) (1.15) (1.14)
AGED60 × INCD30 = 1 if older resident with low income; 0.15 0.14 0.12 0.13
AGED60 × INCD30
otherwise, the value is 0. # (0.36) (0.35) (0.32) (0.34)
51.40 56.54 57.58 56.02
INC10T Yearly household income (10,000 NTD)
(33.95) (37.56) (32.82) (34.56)
Donation dummy
0.21 0.29 0.20 0.23
DOND 1, history of donation for environmental protection;
(0.41) (0.45) (0.40) (0.42)
0, otherwise.
Note: Standard deviations are indicated in parentheses. * A typical 5-point Likert scale was used (5 = strongly
agree, 4 = agree, 3 = neutral, 2 = disagree, and 1 = strongly disagree). # Two dummy variables were multiplied to
create a variable (AGED60 × INCD30 ) representing older residents with low income. AGED60 = 1, if age > 60 years;
otherwise, the value is 0. INCD3 = 1 if the yearly household income is <300,000 NTD; otherwise, the value is 0.

Table 7. Estimation results of the logit model.

Aspects of
Provision Regulation Culture Support
Ecosystem Services
Variable Coefficient Prob. Coefficient Prob. Coefficient Prob. Coefficient Prob.
C −2.3566 ** 0.0013 −2.8351 ** 0.0016 −2.4930 ** 0.0017 −2.5103 ** 0.0017
BID −0.000372 *** 0.0004 −0.000478 *** 50.0001 −0.000388 *** 0.0002 −0.000392 *** 0.0002
AGREEEE 0.4985 *** 0.0009 0.6071 ** 0.0014 0.4488 ** 0.0062 0.5151 ** 0.0023
GENDER −0.3321 0.1157 −0.4245 * 0.0460 −0.2621 0.2130 −0.3379 0.1060
OCCUDPUBLIC −1.1301 ** 0.0017 −1.0476 ** 0.0035 −1.0967 ** 0.0028 −1.0541 ** 0.0031
STAYHR 0.1631 0.0802 0.1975 * 0.0355 0.2161 * 0.0196 0.2006 * 0.0294
AGED60 × INCD30 −1.0980 ** 0.0025 −1.0377 ** 0.0034 −0.8493 * 0.0161 −1.0427 ** 0.0030
INC10T 0.0089 * 0.0109 0.0097 ** 0.0065 0.0100 ** 0.0040 0.0087 ** 0.0098
DOND 0.8491 ** 0.0010 0.7813 ** 0.0025 0.8886 *** 0.0005 0.6833 ** 0.0068
Note: P(Y) is the dependent variable. Refer to Table 6 for variable definitions. *, **, and *** significant at the 10%,
5%, and 1% levels, respectively. Standard errors are in parentheses.

The willingness to pay for conserving the regulating, culture, and supporting ecosys-
tem services exhibited a significant positive association with length of stay per visit. Length
of stay per visit was included in this study as a variable to represent personal direct inter-
action with the hillside forest because the regulating, culture, and supporting ecosystem
services necessitate on-site interaction between humans and nature.
An individual’s judgment regarding the affordability of a service is constrained by
income. Household income positively affected the willingness to pay the bidding amount.
Int. J. Environ. Res. Public Health 2022, 19, 6193 12 of 17

The residents who were employed in the military, civil service, or education sector
tended to reject the payment. Moreover, those who did not directly depend on local
resources for their livelihood declined to pay for conserving the ecosystem services. Those
who had high reliance on forest resources for their livelihood assigned higher value to the
ecosystem services.
An individual’s willingness to pay for conserving the ecosystem services offered by
the forest was strongly influenced by a history of donations for environmental protection.
The residents who had ever donated for environmental protection were more willing to pay.
The older residents with low income tended to decline paying the bidding amount
because of their perception of affordability and local economic stagnation. Rampant
urbanization in Taiwan has prompted the exodus of people from rural areas despite local
social and economic development initiatives promoted by the government [64].
The women were more willing than men to pay for conserving the regulating ecosys-
tem services; willingness to pay for the other services did not differ significantly between
the sexes.

3.4. Economic Value of the Ecosystem Services

This study examined the economic value of the ecosystem services on the basis of the
results of the single-bounded dichotomous contingent valuation method and regression
analysis (Table 7).
The economic value of the forest ecosystem services to residents was determined by
evaluating the residents’ willingness to pay for conserving the current ecosystem services
that they received and enjoyed. Some respondents psychologically resisted paying for
the ecosystem services they already had access to; these should be classified as protest-
ing samples. Those who did not agree with the economic value received no benefits
from the ecosystem services. The protesting residents were unwilling to pay the bidding
amount, indicating that the economic value they assigned to the service was lower than the
bidding amount.
The point estimates for the economic value of the provisioning, regulating, culture,
and supporting ecosystem services were 2688.17, 2092.05, 2577.32, and 2551.02 NTD,
respectively (Table 8).

Table 8. Point estimates of the economic value of the ecosystem services. Unit: NTD.

Aspects of Ecosystem Services Provision Regulation Culture Support

2688.17 2092.05 2577.32 2551.02
Note: Cameron [34,63] indicated that the point estimates of the willingness to pay in the single-bounded contingent
valuation method can be approximated using the formula E(WTP) = −1/ βˆ1 , and the βˆ1 is the estimator of the
bidding variable in logit regression.

4. Discussion
4.1. Land Zoning Policy and Government Intervention
Taiwan is located at the junction of the Eurasian plate and the Philippine plate and has
high mountains and steep slopes. The Lanyang River Basin, located in northeast Taiwan, is
the most vulnerable watershed on the island. The stream, only 73 km long, originates from
more than 3000 m above sea level from the northern Nanhu Mountain, to rush into the sea.
It flows through the entire Yilan County. The watershed covers an area of 978 km2 [65].
In the middle- and high-altitude areas of the Lanyang River Basin (areas with an altitude
of approximately 500 m above sea level), the mountains are high and steep, with limited
human activities. Where the Lanyang River flows into the foothills in its downstream
reaches, local residents are typically involved in agricultural activities. The river then enters
the delta plain, which is metropolitan area with numerous human activities.
The land zoning plan implemented by the government calls for forest coverage in the
foothills of the Lanyang River Basin, and local ecosystem services are relatively effective.
However, the basin is affected by land-use patterns such as agricultural reclamation.
Int. J. Environ. Res. Public Health 2022, 19, 6193 13 of 17

Because the entire water catchment area is located in the northeast of Taiwan and it is
on the windward side of most typhoons striking the island, the land is highly vulnerable.
Thus, this land has been the focus area of global environmental changes. The benefits and
impacts of low-altitude piedmont forest ecosystems on local residents merit in-depth study
and evaluation and are directly related to the current agricultural reclamation development
and climate change adaptation. Further human exploitation would result in an increase in
the risk of disasters.
The evidences provided in this study affirmed the need to conserve hillside forests
as the residents have high agreements toward the four aspects of the ecosystem services
(Tables 2 and 3).
Moreover, with the increasing threat of natural disasters due to climate change, in-
formation on the value of the ecosystem services can be used as a policy basis for the
management of low-altitude sloping land disaster risk systems. The economic values of the
ecosystem services the residents received are evidenced high as indicated in Table 8. This
information can promote the establishment of disaster adaptation strategies for maintaining
the hillside ecosystem and its services as well as facilitate the overall spatial planning for
hillside areas under climate change.

4.2. Better Governance of Our Full World at Current Anthropocene

Based on the image of our current world—a full world, as it is called by Herman
Dally [1]—it tends to be a world of anthropocentric Anthropocene, and humans are the
primary benefactors and the receivers of ecosystem services [66,67]. Hence, the present
study assessing for a relevant value indicator that can serve as an index for government
interventions would help a better governance of our full world at current Anthropocene.
The economic values of provisioning, regulating, cultural, and supporting ecosystem
services enhance the feasibility of policy formation for land zoning at mountain frontiers
in an ultimate use of the ecosystem services for the benefit of humans. It can also help to
ensure long-term human well-being and sustainable development.
The difference in philosophy between anthropocentricity and biocentricity has led to a
debate [15]. In terms of anthropocentric philosophy, the benefits that humans can derive
from their activities are a major focal point. Anthropocentric philosophy tends to prioritize
humanity and view other species only as exploitable resources. Exploitation or protection
for human well-being is a primary choice and has attracted attention because of the self-
interest of humans. Biocentricity seems an ideal, however. On behalf of sustainability, the
evaluation conducted in the current research affirmed that conservation for hillside forests
can ensure local residents’ welfare and so leads to a better Anthropocene.

4.3. Local Industries and Livelihood of Residents

Yilan is an agricultural county and attaches considerable importance to environmental
protection. Limited industrial activity takes place in the coastal area. The land is fertile,
and water and soil resources are pure and abundant.
Agricultural recreational activities are popular in this area, and they can be combined
with forest ecological resources in the foothills to promote ecotourism and leisure agricul-
ture in the form of organic agriculture or ecological or environmentally friendly agriculture.
Recreational, organic, or friendly farming all depend on a healthy ecosystem. Yilan County
is an ideal area to promote these farming practices and is an appropriate area for Taiwan to
construct a model of sustainable agriculture.

4.4. Policy Implementation at the Mountain Frontier of Human Activities

The livelihood and property of local residents rely substantially on nearby hillside
forests [57]. In this study, the local residents exhibited high agreement with the value
of the ecosystem services, thus highlighting the importance of maintaining slope forest
ecosystems for the welfare of local residents. Disturbing slope forests would strongly affect
the economic well-being of local residents in relation to ecosystem services; thus, the current
Int. J. Environ. Res. Public Health 2022, 19, 6193 14 of 17

expansion of agriculture to hillside forest areas due to climate change is inappropriate.

Local agriculture can be promoted through dedicated organic farming due to the availability
of pristine water and soil and can be combined with the recreational or processing industry
instead of advanced mechanized farming. Moreover, hillside ecotourism that can maintain
the ecosystem services and sustain residents’ livelihood should be promoted.

4.5. Noncommodification of Nature: Economic Valuation from the Perspective of

Ecological Economics
Market exchange systems can only represent a part of the economic value of ecosystem
services. In human society, trading is a mechanism for maintaining social order. Most
ecosystem services are public goods with positive externalities and are neglected by the
public. The value of nonmarketable services cannot be directly presented in the trading
market. Thus, the nonmarketable value of ecosystem services is often omitted in society,
leading to lack of focus on such services in relevant policies. The value of nonmarketable
services should be considered to understand the true economic value of the ecosystem from
the perspective of the interdisciplinary field of ecological economics.
The economic value of nonmarketable services should be estimated in order to increase
the importance attached to the conservation of services offered by the natural environment.
This would not be a valuation for subsequent sale in the human-centered misconception
of the natural capital marketization and financialization. In the contingent valuation
method, welfare is measured in terms of mainstream value reasoning in consumer theory.
The value index can guide the conservation of the environment for public good and as a
common asset; this valuation does not refer to a price for sale in the dynamic circulation
of materials, energy, and services from the ecological economics perspective. In terms of
geographical Anthropocene [68], humans are now overwhelming the great forces of nature.
As aforementioned, conservation and protection of hillside forests in the mountain frontier
is critical for a better Anthropocene.

5. Conclusions
At the frontier of land development and the junction of nature and human society,
the forest ecosystem provides nearby residents with provisioning, regulating, culture, and
supporting ecosystem services and generates economic value. Most of the ecosystem
services are nonmarketable, and only a few of the services are marketized. No market price
can accurately quantify the direct benefits that nearby residents derive from these services.
In contemporary society, specific price indicators generated in the trading market system
are used as tools for economic and social decision-making. Thus, ecosystem services have
not been provided reasonable attention in the process of overall social decision-making.
This study investigated how ecosystem services benefit residents in a frontier area from the
perspective of ecological economics.
The single-bounded dichotomous contingent valuation method was applied with logit
regression. The results indicated that the forests in the low-latitude hillsides of the Lanyang
River Basin currently provide the local residents with the provisioning, regulating, culture,
and supporting ecosystem services. The economic value of the four ecosystem services was
considerably high. The results of this study highlight the importance of the conservation
and maintenance of the low-latitude hillside forest ecosystem and that disturbances in the
hillside forest can affect the economic well-being associated with the ecosystem services
enjoyed by local residents.
This study investigated the determinants of the value of these ecosystem services.
Binary regression analysis was conducted to identify factors affecting the residents’ will-
ingness to pay specific bidding amounts for ecosystem services. The results indicated
that the residents’ willingness to pay increased with their agreement with the value of
the ecosystem services and their income. The residents with experience in donating to
environmental organizations tended to be willing to pay the amount asked. However, the
Int. J. Environ. Res. Public Health 2022, 19, 6193 15 of 17

older individuals with low income in the area had lower willingness to pay due to their
perceptions of affordability.
Ecosystem services refer to benefits that ecosystems provide to humans. Taiwan is
mountainous and densely populated. Thus, the appropriate management of forest cover at
the intersection of natural ecosystems and areas with widespread human activity is crucial.
The forest ecosystem service at the junction of agricultural and residential areas is extremely
sensitive to the surrounding land use and social and economic activities as well as changes
in nearby land-use patterns. Moreover, the societal disturbances can affect ecosystem
services. The results of this study have crucial policy implications. The conservation
of hillside forests and the performance of ecosystem services are directly related to the
survival, life, and livelihood of local residents. The forests and surrounding residents
dynamically and continually interact with ecosystem services. Individuals who live nearby
hillside forests benefit from the ecosystem services provided by these areas; residents who
engage in occupations dependent on nature stand to benefit the most from such services.
The life of nearby residents is closely integrated with the provisioning, regulating, culture,
and supporting ecosystem services of the hillside forest. Relevant land planning policies
should consider the interaction between humanity and nature. Current hillside forests that
are well protected by government zoning regulation are better maintained. Viable local
policy for vicinity residents’ livelihood is suggested to promote ecotourism to maintain the
ecosystem services of hillside forests and to integrate together with local recreational and
organic agriculture.

Author Contributions: Conceptualization, methodology, investigation, software, validation, and

formal analysis, writing, and editing: W.-J.C.; organizing research project, survey design, paper
review, and paper submission: S.-C.L.; research project administration, W.-J.C., J.-F.J., C.-H.C. and
S.-C.L. All authors have read and agreed to the published version of the manuscript.
Funding: This research was funded by Ministry of Science and Technology, Taiwan, grant number
MOST 110-2321-B-004-001.
Institutional Review Board Statement: Not applicable.
Informed Consent Statement: Not applicable.
Data Availability Statement: Not applicable.
Acknowledgments: We gratefully acknowledge three reviewers for their helpful comments and
suggestions. The interviewers of this in-person survey are: W.J.C., W.R.C., C.C.C., I.J.H., W.M.H.
and S.C.L.
Conflicts of Interest: The authors declare no conflict of interest.

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