Environmental and Natural Resources

Northern Gulf Institute: AEC Research Projects

Estimating the Value of Restoring Mississippi's Barrier Islands

P.I.: Daniel Petrolia
Collaborator: Greg Carter (USM-Gulf Coast Geospatial Center)
Postdoctoral Research Associate: Tae-goun Kim (Korea Maritime University)
M.S. Research Associate: Gwan-seon Kim

A dichotomous-choice contingent-valuation survey was conducted in the State of Mississippi (USA) to estimate willingness to pay (WTP) for three restoration options being considered for the state's barrier islands. Random-effects probit models were estimated, and parametric and non-parametric WTP estimates and confidence intervals were calculated. Turnbull lower-bound mean WTP was $22 per respondent to maintain the existing footprint over a 30-year period, $152 to restore 2,338 acres (pre-1969 footprint), and $277 to restore 5,969 acres (pre-1900 footprint). Econometric results indicate that for the Pre-Camille and Pre-1900 options, coastal residents and those citing storm protection, recreation impact, and environmental impact as primary decision factors, were more likely to support restoration, with marginal effects of these greater for the Pre-Camille option. For the Status-Quo option, 75% of respondents voted in favor of restoration, and the offered bid was not significant; only the hurricane-protection and environmental-impact variables were significant for this option.

Analysis of Evacuation Behavior on the Gulf Coast

P.I.: Daniel Petrolia and Terry Hanson (Auburn University)
Postdoctoral Research Associate: Sanjoy Bhattacharjee

A multinomial choice framework was used to analyze data from hypothetical storm forecast scenarios administered via mail survey to a random sample of U.S. Gulf Coast residents. Results indicate that the issuance of a mandatory evacuation notice and the presence of higher wind speeds had the largest influence on increasing the likelihood of evacuation. Age, race, disability, distance, and education were significant in explaining one's decision to wait relative to choosing to evacuate. Blacks and disabled individuals were strictly less likely to wait and more likely to make an immediate evacuation decision. Hurricane Katrina evacuees and those with an evacuation destination identified were also more likely to decide to evacuate, but were also more likely to wait before deciding. Results indicate that residents of mobile homes were more likely to either evacuate or wait before making a decision, but strictly less likely not to evacuate. Respondents very confident in being rescued were strictly more likely not to evacuate. Results indicate that not having an evacuation destination identified was the most influential factor regarding the likelihood of not knowing what choice to make.

Estimating the Value of Preventing Land Loss in Coastal Louisiana

P.I.: Daniel Petrolia
Postdoctoral Research Associate: Tae-goun Kim (Korea Maritime University)
M.S. Research Associate: Ross G. Moore

The objective of this research is to provide estimates of the value that residents of Louisiana place upon the prevention of projected future wetland loss. In addition to providing estimates of the public's willingness to pay for these projects, this paper identifies the motivating factors that contribute to public support of the prevention of projected future wetland loss. This is accomplished through analysis of public preference among three proposals. The first option, the "short run" proposal, is for the prevention of future wetland loss that will begin in 2015 and maintain current levels of wetlands through 2050. The next option, the "long run" proposal, is for the prevention of future wetland loss that will begin in 2035 and maintain current levels of wetlands through 2185. The final option presented is for no action to be taken to prevent future wetland loss. This analysis shows which option between long run projects (which take longer to implement and provide benefits farther into the future), short run projects (where benefits are obtained sooner but do not last as long), and no action is preferred. Also, it shows which factors and the magnitude of those affects on ones decision between the three options. Responses for the preference of respondents between the three proposals showed that 71.3 percent preferred the short run proposal, 6.86 percent preferred the long run proposal, and 22.01 percent chose no action. Most respondents were willing to support some for of prevention of wetland loss.

Economic Recovery of seafood processors and dealers, marinas, commercial harvesters, and live bait dealers in coastal Mississippi

P.I.: Benedict Posadas (MSU Coastal Research & Extension Center
Student Worker: Heather Dikes (MSU Coastal Research & Extension Center

The results of the economic assessment conducted after Hurricane Katrina indicated massive devastation of the Mississippi commercial and recreational fishing fleets. Almost one-half of the 1,030 resident commercial fishing boats and vessels operating in the state participated in the damage assessment in 2005 and 2006. Among the 100 charter boats for hire operating in the state when Hurricane Katrina landed, 42 operators participated in the survey. The decision to remain or leave the industry - commercial or recreational fishing - was very crucial to these participating boats or vessels. About 87% of participating commercial boats or vessels and 69% of the participating charter boats reported damages associated with Hurricane Katrina. Using the 2006 and 2007 databases on licenses issued by the Mississippi Department of Marine Resources to resident commercial and recreational boats and vessels, the decision to remain or leave the industry by the participating boats and vessels was determined. It was postulated that the economic decision to stay or leave the commercial fishing or charter boat for hire industry was influenced by several economic and technical factors.

Impacts of Media Coverage of Coastal Weather Events on Attendance Levels at Northern Gulf State Parks

P.I.: Kimberly L. Morgan
Research Associate: James Harris

The project goal was to estimate the relative impacts of adverse weather events and resulting media coverage on attendance at six publicly funded recreational facilities located in the Northern Gulf. A multiple regression model was estimated for each of two study regions to assess the relationships between weather events and media publications on monthly park attendance. For the Greater New Orleans, LA area, when keywords appeared in newspapers at least once monthly, a negative and statistically significant decline in average monthly attendance was revealed, resulting in an average decrease of 5,761 visitors that represented approximately $103,698 in lost annual revenues. For the Pensacola, FL region, a negative and statistically significant relationship between adverse weather events and park visitation resulted in an average 4,659 fewer visitors per month where extreme weather occurred, which represented approximately $83,862 in lost annual revenues. Only a weak negative and statistically insignificant decline in average monthly attendance when keywords appeared in newspapers was estimated. These findings are expected to improve decision-maker awareness of those factors that significantly impact recreational attendance levels linked to adverse weather events; in particular, the impacts on public park revenues by unanticipated and unintended public response to news media.

Local Economic Impact of Coastal Hazards on Public Agencies

P.I.: Kimberly L. Morgan

Public agencies located within coastal communities incur fiscal and managerial responsibilities before, during and after the occurrence of natural hazards, such as tropical storms, hurricanes, hail, algal blooms and water pollution. The overall study goal was to determine what type of budgeting process is used in the case of a natural hazard event. A survey of city and county managers was conducted to determine what sort of planning activities are undertaken BEFORE coastal hazards such as harmful algal blooms, hurricanes/tropical storms, tornados and flooding occur. In order to describe importance of planning activities, respondents were asked about specific actions taken during and immediately after Hurricane Gustav impacted their county. Respondents were asked to identify any outside agencies that they interact with in these same three periods that provide personnel, equipment or financial support. Responses were received from 12 counties located within the Northern Gulf region that had been directly impacted by Hurricane Gustav in 2008. The survey results will be analyzed and presented alongside existing literature to evaluate the economic impacts of coastal hazards on public facilities and managers, local residents, and taxpayers, and, to determine an appropriate method to assess the effects of, and prepare for, future adverse environmental events.

Market Integration for Shrimp and the Effect of Catastrophic Events

P.I.: Andrew Muhammad (USDA-ERS) & Adrian Harri
Collaborator: Keithly Jones (USDA-ERS)

This study employs the Prestemon and Holmes assumption that cointegration between the different shrimp markets occurs because of intertemporal arbitrage. Similarly, we assume that different shrimp markets can be defined over the "information space" as those submarkets that respond statistically in a similar way to the same information about the factors affecting shrimp demand and supply. This study also investigates the effects of hurricane Katrina on shrimp prices in the Gulf Coast region and whether these effects are reflected in shrimp prices on the Atlantic and Pacific Coast. Preliminary results indicate that several price series from different regions/markets are cointegrated. Cointegrating relationships are found to exist between the price series of brown, pink and white shrimp from the Gulf Coast and spot shrimp from the Pacific, rock shrimp from the Gulf Coast and white shrimp from the Atlantic and brine and spot shrimp from the Pacific. An important result is the fact that price of imported shrimp is cointegrated with each of the domestic shrimp price series. This finding may have important implications regarding the relationships between the different domestic price series and the effect of catastrophic events on one series and their spillover effects.

Assessing Research Needs of Coastal Natural Disaster Risk and Insurance

P.I.: Daniel Petrolia, Keith Coble, and Craig Landry (ECU)
M.S. Research Associate: Jihyun Lee

The objective of this research project was to identify key research questions issues related to mitigation of coastal risk and the role of insurance, with a particular focus on low-probability events such as major hurricanes. The needs assessment was based on interactions with government, insurance industry personnel, and academic experts on coastal natural disaster risks. This included consultation with NOAA Chief Economist Dr. Rodney Weir, in an effort both to increase NOAA's awareness of our research capabilities and to receive guidance on better incorporating NOAA's socioeconomic research needs into our work. Those research questions identified during this phase were then proposed as part of the NGI's socioeconomic research portfolio for Years 4 and 5.

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