Assessing the Economic Value of Improvement in Water Quality and Aquatic Ecosystem Services Resulting from Ecological Stream Restoration in South Korea

Urbanization and environmental degradation have led to significant declines in water quality and aquatic ecosystem health, highlighting the urgent need for effective restoration efforts. This study applies an integrated analysis approach to estimate the economic value and benefits of improvements in water quality and aquatic ecosystem services resulting from the Ecological Stream Restoration Project. Using survey data analyzed through the choice experiment (CE) method, we assessed respondents’ preferences for various ecosystem services, including water-friendly services, ecological functions, water-level control, and water-quality purification. Three empirical analysis models—the Conditional Logit Model (CLM), Nested Logit Model (NL), and Error Component Logit Model (ECL)—were applied, with the ECL model identified as the most suitable for this study. From the physical impact assessment, we derived compensating variations to estimate the annual economic benefits of the project. The estimated annual economic value of water quality improvement due to the Anyangcheon Ecological Stream Restoration Project ranged from approximately KRW 10.54 billion to KRW 21.44 billion, while the economic value of aquatic ecosystem improvement was estimated to range from KRW 6.05 billion to KRW 12.30 billion annually. This study provides analytic framework that can inform future ecological restoration projects and sustainable water management policies.