| Summary: | According to the National Water Act of 1998, an estuary is an enclosed body of water that is either periodically or permanently open to the ocean. Within an estuary, the seawater is diluted to a measurable degree, creating a unique aquatic environment for animals and plants. Estuaries are environmental and economic assets to the population. The health status of our local estuaries, however, is being compromized due to a steady decrease in the freshwater inflow and supply. Tides and climatic conditions do have an impact upon the dynamics of an estuary, but these factors remain relatively constant throughout each year. The freshwater inflow and supply, however, are highly variable and are directly influenced by human involvement. Upstream abstraction for industrial and domestic use, for example, could lead to mouth closure where the ocean meets the river. The National Water Act of 1998 was established to address the lack of research and predominant mismanagement of freshwater inflow into South Africa’s estuaries (Allanson and Baird, 1999). To ensure proper water resource management, different water allocation costs and benefits need to be compared and analyzed to secure an optimum solution (Mlangeni, 2007). Like many environmental services yielded to man, estuary services are not traded in any markets. Alternative markets are thus sought to allow the estimation of the values of such services. Among the available valuation techniques are the Contingent Valuation Method (CVM), Travel Cost Method (TCM) and Hedonic Pricing Method (HPM). The involved benefits of water allocations are predicted in this study by use of the CVM which elicits respondents’ willingness to pay (WTP) towards predetermined changes in freshwater inflow into estuaries. The CVM was applied throughout the Water Research Commission’s (WRC) Project K5/1413 from 2000 to 2008 (Hosking, 2010). Each individual study employed specialized surveys which ideally created a close correspondence between the answers provided by respondents to the supposed scenarios and their voluntary exchanges in markets should money actually have been handled (Mlangeni, 2007). Much criticism has been directed towards the CVM, but careful use and application of the method has been shown to produce significant and satisfactory results (Hosking, 2010). The primary aim of this study was to collectively analyze the collated data provided by the WRC and compare the results with the findings of previous studies. Each variable was analyzed separately in order to reveal any discrepancies between the respective findings. A supplementary objective of this study was to add to the body of knowledge pertaining to South Africa’s estuaries and guide management in the distribution of freshwater towards proficient levels (Du Preez and Hosking, 2010). The associated change in the cumulative consumer surplus with an increased freshwater supply into forty selected estuaries was therefore investigated. The subsequent benefits due to a superior freshwater supply are therefore reflected (Du Preez and Hosking, 2010). The data gathered by each of the individual researchers throughout their studies (supported by the WRC) were combined to form a single dataset including all recorded information supplied by the corresponding respondents. As the investigation progressed, improvements were made upon the questionnaires posed to the considered estuary populations. Consequently, some of the data in the combined dataset were “missing”, since previous studies did not include certain questions, while later studies omitted others. Data imputation was employed to create an imputed dataset, enabling the modeling of the public’s WTP through regression techniques. A linear model was utilized in this study, also incorporating interaction between the predictor variables. The double-log functional form was implemented to estimate the public’s WTP. The population’s total willingness to pay (TWTP) was further estimated by aggregation. A summary of the respective results is displayed in in Table 1.
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