AgriFood-Report 2010:2

A Room with a View

Authors: Carolina Liljenstolpe 

The payments within the Rural Development Programme for Sweden 2007- 2013 seek to improve the environment, the landscape, contribute to rural development and economic growth. The measures employed to enhance the environment and the landscape may have visual effects and hence there should exist measurable impacts on the landscape. Compensation payments within the Program are relatively extensive though. In Sweden Axis 2 presently holds over 80 percent of the total budget, which translates to an annual amount of 3.5 billion SEK. As these payments partly partly are financed by Swedish taxpayers it is of interest to investigate the willingness to pay for these environmental improvements.

To achieve a measure of willingness to pay for the environmental effects, a hedonic pricing approach is used. The price for staying at holdings in the Staying on farms registry is used to quantify environmental effects. To measure the environmental effects variables are constructed in GIS (Geographic Information System). These are quantified from coordinates from the Staying on a Farm registry and map layers describing meadows, pastures or restorable land from the TUVA inventory, agricultural blocks from the Swedish Board of Agriculture, roads from the Swedish Transport Agency and urban areas from Statistics Sweden.

The results of this study indicate that there is a relationship between the price of rentals and independent variables such as classification level, closeness to urban areas, the existence of animals on the farm as well as the environmental variables. Environmental protection zones and the existence of animals on the farm are positively valued. On the other hand of arable land, grassland and TUVA areas are negatively valued. Hence, the results from this study a positive willingness to pay for a diversified landscape and a negative willingness to pay for actions leading to a more monotonous landscape, such as payments to environmentally sound grazing systems.


Carolina Liljenstolpe

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