Smallholder farmers’ willingness to pay for sustainable land management practices in the Upper Blue Nile basin, Ethiopia

Sustainable land management (SLM) practices for curbing the effects of land degradation, mainly in drought-prone areas, have been addressed by the community-based watershed development (CBWD) scheme since the 1980s in Ethiopia. However, the scheme has failed to consider farmers’ potential willingness to pay (WTP) for SLM practices, as well as basic biophysical, socioeconomic, and institutional factors. This study estimated farmers’ potential WTP (in terms of labor) and analyzed the drivers behind it in the Upper Blue Nile basin in Ethiopia. A contingent valuation method and Tobit econometric model were used to analyze survey data from 300 household heads. About 76% of the farmers said they would be willing to contribute labor (3.5–28 man-days yr−1), but the mean WTP (9.4 man-days yr−1) of the three watersheds was less than the set government value (28 man-days yr−1). The farmers’ WTP aggregate benefit at the watershed scale was estimated to be US$55,572 yr−1. The econometric model results revealed that sex, age group, farmland size, SLM-related training, and household perception of land degradation influenced farmers’ potential WTP. To this end, revising the current CBWD scheme by considering various aspects of farmers’ WTP would help to make the scheme demand-driven. Moreover, the provision of gender- and resource-disaggregated training and the introduction of economic incentives to increase the economic productivity of SLM practices would enhance farmers’ maximum WTP capacity and assure sustainable community participation.