User Benefits of Urban Agriculture In Havana, Cuba
An Application of the Contingent Valuation Method
by Patrick Henn
A Thesis Presented to the Faculty of Graduate Studies McGill University in partial fulfillment of requirements for the degree of Master of Science, December 2000
The "Abstact" and "Conclusion" are included on this HTML page.
The complete thesis (136 pages) is available as a PDF (360K) here.
In Cuba, the act of growing food in the city has become a way of life. Since the beginning of the "Special Period in Time of Peace", brought about by the collapse of the Soviet Union in 1989, Cubans have engaged in many forms of urban agriculture (UA) to cope with the food crisis affecting the Island. In Havana, the popular garden movement occupies 8% of total urban land in agriculture (3.4% of total urban land) and is practiced by 18,000 gardeners who produce vegetables and fruit, and raise small livestock to increase food security and generate income. The purpose of this study was to provide estimates of the user benefits of UA, as well as qualitative and quantitative information related to this activity. The contingent valuation method (CVM) was used to elicit users' willingness to pay (WTP) for the land they use, that is currently provided at no charge by the state. The average WTP was estimated at 23.5 pesos/1000 m 2 /month under current conditions and 34.4 pesos/1000 m 2 /month with improvements in water and anti-theft services. These amounts represent about 11% and 14% of monthly household income, respectively. Aggregate WTP for popular gardens in the city of Havana was estimated to be 6.88 million pesos/year (344,000 $US) and 10.07 million pesos/year (503,500 $US) with the proposed improvements. The study has produced important results that give an indication of the use and non-use value of UA for gardeners of Havana. Results also suggest that CVM is a non-market valuation technique that can be successfully applied in Cuba, and can provide information to be integrated in cost-benefit analysis frameworks that assess the importance of UA.
5. Conclusion"...It seems that urban agriculture makes sense on ecological, social, and economic grounds virtually everywhere on Earth. Governments should see it as an idea whose time has come" (Rees, 1997).
When Cubans spontaneously created gardens throughout the city of Havana, they probably thought, and even hoped, that it would be temporary, just as the harsh Special Period they had just plunged into. The urban agriculture system came from the necessity of feeding the local population and providing basic medicine for a country in crisis. Ten years later, these gardens, now occupying 3.4% of urban land and tended by 18 000 individuals, seem to be much more than a means to cope: they are becoming part of the landscape, part of the way of life. But just as this is happening, Cuba is slowly but surely recovering from the fall of the Berlin Wall. The Cubans have developed joint ventures with foreign businesses, more trade agreements, and there has been some easing of the embargo from the United States. While these can be beneficial to the Cuban people, some are concerned that it will bring Cuba back to a state of dependence on foreign products and inputs. This is especially true for the urban food supply. Will Cuba revert to foreign imports in order to feed its urban centers?
Opportunities for Cuba to develop within the global market may take a toll on the support for urban agriculture in Havana. For example, tourism is very important in this city, and using more urban land to serve that industry is already part of the management plan for land presently used for UA. If the city can have access to foreign food supplies, urban land used for agriculture may be used for hotels and shops for tourists. This is a policy issue where economic valuation can contribute by estimating the welfare impacts of such transitions and make the most socially efficient choice. What would be, for example, the impact of taking one hectare of land in usufruct in Havana and using it for a hotel complex? According to environmental cost-benefit frameworks, the impacts of such a change are economic, social and environmental. It is also an issue directly linked to the concept of sustainability in urban systems.
Cities have often been accused of developing in an "open loop" format (UNDP, 1996), consuming large amounts of inputs and products while producing large amounts of waste to be disposed of in the surrounding environment. This problem, along with social disparity, is being exacerbated by the fast rise in urban population. In this context, UA can contribute to the sustainability of a city by providing an array of economic, social and environmental benefits: increasing local food security, waste recycling, reducing food transportation costs, abating pollution, creating employment and providing green space for city dwellers. Urban agriculture cannot be expected to compete, in terms of cash flow, with other types of development, such as hotels that bring in foreign currency. However, there are many other benefits to UA that are not translated into income generation. This study represents an attempt to measure some of these potential non-market benefits, derived from the user value of land in UA in Havana.
The contingent valuation method was used to estimate user value of UA land in Havana, for individual producers granted a unit of state land in usufruct. It was estimated that the producers were willing to pay an average of 23.5 pesos per month per 1000 m 2 for their land, and an average of 34.4 pesos per month per 1000 m 2 for their land with improvements in water and anti-theft services. The data suggest that direct use value, indirect use value and also non-use value were determinants of WTP. Using the estimates above, the aggregate user value of land in UA in Havana, analogous to a rent that could be collected by the state, is 6.88 million pesos a year (344 000 $US), and 10.07 million pesos a year (503 500 $US) with improvements. In fact, the individual WTP values show that an average of 11% of total household income would be contributed to paying the fee, or 14% with the proposed improvements.
However, this is only part of the total economic value of urban agriculture in Havana. In addition to the user value estimated in this study, other non-market benefits of urban agriculture that affect non-users and the general ecosystem also need to be assessed in order to estimate total economic value. There is also the value to another type of user of these gardens, i.e. the local consumers of the produce that comes from the gardens. There are therefore potential social and economic benefits to these consumers of the presence of UA in their neighborhood, environmental benefits to the general city population that enjoy these gardens as open and green space, and environmental benefits in the form of air pollution abatement that comes from the sequestering of pollutants by the plants themselves. Finally, the urban food system in Havana practices semi-organic and organic agriculture that greatly reduce soil, air and water contamination from synthetic pesticides and fertilizers. These benefits put together provide a more general picture of the total economic value, which can be summarized as all the benefits that have a positive impact on the welfare of the society.
This study was therefore a first attempt at quantifying the benefits of UA. It can be concluded that CVM can be applied to this type of quasi-public good and yield interesting results. However, this study is limited by the fact that some inconsistencies in survey execution and an inadequate sampling procedure may have affected the outcome. As pointed out by many CV researchers (Mitchell and Carson (1989) and Arrow et al. (1993)), the accuracy of CVM comes from well designed, well executed surveys, and methodologically rigorous analysis. This research would have clearly benefited from better survey execution and an adequate random sampling procedure.
It can also be concluded that CVM is adaptable to the Cuban context. Similar to Mourato's (1998) concern of how environmental valuation can work in Hungary, a country in economic transition, there was concern in this application of CVM that Cubans would not understand very well the contingent market and the valuation questions, given the fact that individuals are given very few property rights. As for the CV study in Hungary, this was shown to be wrong, possibly because Cuba can also be considered in transition, especially with regards to the agriculture sector.
These results indicate that urban agriculture in Havana has economic value and that users are willing to pay at least some amount to avoid a loss of access in the good and pay for some improvements. The contingent valuation method was able to be adaptable to the contexts of Cuba and urban agriculture.
It is believed that the information provided in CVM studies could contribute to cost-benefit analysis of UA, such as through the framework developed by Nugent (1999b), by providing monetary measures to be included in the analysis. Future research topics related to UA could include more non-market valuation studies that would aim at assessing other non-market benefits of UA, such as environmental benefits and the benefits to city dwellers that are provided with food from the UA system. A similar study to this one would also be pertinent, building on the information provided in this study and aiming at a more representative sample of the Havana urban gardeners. Given the importance of non-market benefits, a non-market valuation technique such as the contingent valuation method can be useful in order to fully assess the role of urban agriculture in the development of sustainable urban systems.
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