Identification of Public Goods and Bads in South Central Planning Region in

DIMITRE NIKOLOV* PETAR BORISOV** TEODOR RADEV** *Institute of Agricultural Economics – , Bulgaria **Agricultural University – , Bulgaria *E-mail: [email protected]

Определяне на обществените блага и антиблага в Южен централен район на планиране в България Проф. д-р ДИМИТЪР НИКОЛОВ* Доц. д-р ПЕТЪР БОРИСОВ** Доц. д-р ТЕОДОР РАДЕВ** *Институт по аграрна икономика – София **Аграрен университет – Пловдив *E-mail: [email protected]

Резюме

Целта на статията е да се очертаят обществените блага и антиблага от селското и горското сто- панство в Южен централен район на планиране. Съществува голямо разнообразие от публични бла- га и антиблага, свързани със селското стопанство. Много от публичните блага са високо ценени в ре- гиона. Най-важните са: селскостопанският пейзаж; топографията; качеството на почвите; биоразно- образието в земеделските земи; качеството на водата; функционалността на почвите; стабилността на климата; както и устойчивостта на наводнения и пожари. Обществените блага се използват като термин в социално-политически контекст: неща, които са „за общото благо“. В статията се използва неокласическият икономически подход при изследването на публичните блага. Развитието на кон- цепцията за публичните блага е основна в дебата за бъдещето на политика, свързана с поддържане на тяхната наличност и използване.

Ключови думи: обществени блага, селско стопанство

Introduction There is occurring substantial technologi- authors state that markets are not suitable mech- cal and structural change in rural land use, and anism for trade of some goods. The society de- the ongoing, gradual liberalization of agricul- mands certain goods which are not measured by tural markets. The agriculture and forestry sec- prices. The reason of that are inherent qualities of tors provide foods and other specific goods to these goods – non-excludability and non-rivalry the consumers. Some of these goods are public in consumption. The market mechanism is insuf- goods (PG) and public bads (PB). ficient in such cases so provisions of these goods The concept of public goods was developed need a different approach. Economists work on by Samuelson (1954) and Musgrave (1959). These a normative approach, in order to consider when

90 Икономика и управление на селското стопанство, 61, 2-4/2016 public or state intervention in markets may over- used various ways to ensure adequate provision come this problem. of public goods according to the social norms and the level of private provision. The public fi- Theoretical remarks nancing is just one among them. Other authors have found similarity between PGs and private Public good is an item whose consumption is goods. They include both tangible goods and less not decided by the individual consumer but by tangible services demanded by society. Bureau the society as a whole. A public good (or service) et Mahé (2008); Bureau (2010), Poux (2012) de- may be consumed without reducing the amount scribe social and environmental elements of pub- available for others, and cannot be withheld from lic goods. Dwyer and Hodge (1995) have ex- those who do not pay for it. Cornes and Sandler plored the phenomenon of non-profit provision (2003) give a clear exposition of the economic where goals other than profit maximisation drive meaning of “public goods”. These goods have the production choices. It is so-called socially-re- two key intrinsic features nonrivalry and nonex- sponsible production where economic and wid- cludability, as mentioned earlier. Non-rivalry er social and environmental goals are combined, means more than one person can consume the in specific types of farming and forestry practice good at the same time. Non-excludability means (e.g. Grouiez, 2014; SFSCC, 2015). In these situ- that the good is provided to everyone in the same ations, traders in markets would be motivated to place. These two characteristics set up an inap- maintain PGs, due to the broader mix of drivers propriate supply and pricing of these goods in to which they respond. conventional markets, and they are often there- In his discussion of public goods, Musgrave fore described as examples of market failure. (1959) also explains that the characteristic of non- Overcoming of market failure propose consider- exclusion gives rise to two problems: ation of some kind of collective action or public i) Revealing individual preferences for social intervention, to correct it. wants; and There are relatively few examples of pure pub- ii) Even if preferences could be known, select- lic goods. Examples include flood control sys- ing the desired state of distribution through a so- tems, public water supplies, street lighting for cial welfare function. roads and motorways, lighthouse protection for Olson (1965) develops the problems raised by ships and also national defence services. the non-exclusion characteristic through the dis- cussion of “free rider” behaviour. This is selfish Quasi-Public Goods behaviour – where an individual seeks to gain A quasi-public good is a near-public good i.e. benefit without paying for it. If everyone does it has many but not all the characteristics of a such behaviour (why should I pay if I can get the public good. Quasi public goods are: benefit for free?) there will be problem with sup- • Semi-non-rival: up to a point, extra consum- ply of these goods because no-one willing to pay. ers using a park, beach or road do not reduce the The free rider problem leads to under-provision space available for others. Eventually beaches of a good and thus causes market failure. become crowded as do parks and other leisure Market failure stimulates economists to search facilities. Open access Wi-Fi networks become appropriate tools in order to correct this situa- crowded. tion. Three kinds of recommendations are usual- • Semi-non-excludable: it is possible but often ly suggested: intervention by the state to provide difficult or expensive to exclude non-paying con- the goods directly (e.g. compulsory purchase and sumers. E.g. fencing a park or beach and charg- management of a nature reserve); the use of mar- ing an entrance fee; building toll booths to charge ket instruments to influence provision (e.g. tax for road usage on congested routes. or incentive payment/subsidy to decrease private The OECD, in its analysis of public goods in generation of public bads or increase private sup- farming and forestry (OECD, 2013), suggest to ply of public goods in the production of private

91 Identification of Public Goods and Bads in South Central Planning Region in Bulgaria goods); or regulation in order to re-define proper- various kinds of PG’s which must be identified in ty rights so as to place public duties upon private the South central region. Each of them can con- actors (e.g. prohibition on certain types of land tribute to attractiveness of the region for living use or management, for sites or assets of specific and doing business. public value). Research work – case study approach How we define a public good in the context of agriculture and forestry? The main public goods in the South One in which each individual’s consumption Central Planning Region leads to no subtraction from any other individ- South Central Planning Region (SCPR) is ual’s consumption of that good. The pure public located in the southern part of Bulgaria. In the good is one for which the total output. northern part bordering with the North Central Non-excludable – if the good is available to region and the main ridge of Stara Planina is a one person, others cannot be excluded from the natural northern boundary of the area, South bor- benefits it confers. ders with Greece and Turkey, East borders the Non-rival – if the good is consumed by one South Eastern Planning Region and to the West person it does not reduce the amount available to with the South West region. There are five ar- others. eas: , Plovdiv, , and Given the defining characteristics of public . The area covers the western half of goods, their supply cannot be secured through the Upper Thracian Plain, southern Central Stara markets. This is because non-excludability and Planina, part of the Central forest – Balkan fields non-rivalry in consumption imply that users have and much of Rhodopes. The area of the region is no incentive to pay for public goods, often lead- 22 365 square kilometers or 20.1% of the coun- ing to over-exploitation. try. The Public goods related to the Agriculture Arable land in Central South Bulgaria are 20.3 and forestry are presented on figure 1. There are percent of the arable land in the country. This is

Factors Landscape, Soil Forests, Protected Zones

Public Bads Public Goods Soil and Water Pollution, Air Biodiversity, Food Security, Rural Pollution, Soil Errosion Vitality, Healthier Lifestyle

Fig. 1. Public bads and goods identified in SCR

92

1

Икономика и управление на селското стопанство, 61, 2-4/2016 one fifth of the area suitable for agricultural pro- gional animal productivity is close to the nation- duction. Crop areas are less than a fifth. However al average. areas under permanent crops are nearly one third Soil cover in SCPR is closely related to the of the plantations in the country. Natural grass as- specific combination of bedrock, the peculiari- sociations occupy 17.8% of the meadow grazing ties of the relief, the direction of the radial move- land in the country. Soil and climatic conditions ments of the earth crust, climatic conditions and in the region favor the cultivation of all crops. human activities that determine the considerable The largest share in the structure of crop areas diversity of soils in the region. They can be char- has wheat – 38.0% of the total area in the region. acterized as: deep soils in lowland areas with soil The second-ranked areas is under sunflower. Al- types: typical cinnamon forest soils, leached cin- though cotton occupies only 1.5 percent, the re- namon forest soils, leached vertisols, pseudo- gion’s main cotton producers as it provides 89.5% podzolic soils, alluvial (diluvial) meadow soils, of the areas of this crop in the country. In the to- swamp (hydrogenated) soils, saline (halomorfni) bacco region occupies a small area – 0.8 to 2.3%, soil; and shallow soils in the hilly and mountain- but this is more than half of tobaccos production ous areas with soil types, humus carbonate soil areas of the country. (shallow and lithosols), shallow cinnamon forest Yields of most crops are larger than average soils (rankeri), brown forest soils (rankeri), brown crop yields obtained in the country. Especially soils with humus-carbonate soils. prominently features cucumbers – 149.8 percent, Forests are an important resource of the SCR, beans and plums – 146.7–132.3%. Lower yields which he far surpasses other areas. They oc- are sunflower and some fruit trees. cupy 46% of the territory. Serious differences The region has well developed livestock. are observed within the region itself, as Smoly- Here grow a little more than one-third of the cat- an and Pazardzhik region are significantly larg- tle in the country – 35.4 percent. Sheep, goats er than other forest areas. Here, public goods are and birds are one-fifth of the total number of expressed in improved air quality, water quality, these categories of animals in the country. The soil functionality, climate stability, resilience to smallest proportion of pigs. The region produc- flooding and fire. In the distant past the valley of es more than one third of the total quantity of Arda it was one of the most forested in Bulgaria, milk in the country – 34.8 percent. Sheep pro- but the exploitation of forest resources, the major- vides more than a quarter of milk received in ity of forests are cut down, so that today large ar- Bulgaria. Slightly less developed is poultry. Re- eas are deforested.

urbanized areas 4% agricultural forest areas areas 46% 50%

Fig. 2. Structure of territory (South Central Planning Region)

93 Identification of Public Goods and Bads in South Central Planning Region in Bulgaria

As well as a diverse suite of more social public • sheltered areas to protect wild birds - Birds goods, including food security, rural vitality and Directive: protected zone “Maritza Plovdiv” pro- farm animal welfare and health, a healthier life- tected zone “Hatcheries Plovdiv” Dam Konush, style, better quality of life - more environmental- Rice paddies Tsalapitsa, Central Balkan, Reser- ly friendly life; voir Sandstone, Persenk, Maritza – Plovdiv, Mar- The terrain is extremely diverse. The area cov- itsa , Hatcheries Plovdiv, Dobrostan ers a large part of the Balkan and Rhodope Moun- Average forest Central Balkan buffer Besaparski tains and objectives and Moun- Hills Hatcheries Zvanichevo Western Rhodopes, tain. Lower parts of the area covering the Upper Maritza – Plovdiv, Rila and Central Forest. Tracian Valley and Sredna and valleys that are • Protected areas for conservation of natural formed around the catchment areas of the River habitats and wild fauna and flora under the Hab- and River. Kardzhali and Smo- itats Directive: Protected zone “Maritsa River” lyan districts are located in the mountains, while protected zone “River Sandstone” Chaya River, others combine high mountains with valleys with Besaparski Hills, Garden forest Trilistnik Forest- farmland. The landscape suggests significant dif- Shishmantsi, andKayal- ferences in the climate of parts of the region. iyka River, Bear River, River Cherkezitsa, Chi- Larger rivers that flow through the territo- narder River, River Omurovska, River Sand- ry are Maritsa, Tundzha, Arda, Stryama, Sa- stone, Central Balkan, Maritsa River, Brestovit- zliyka and others around who are valleys with sa, Rhodopes and West Rhodopes environment, farmland. There are many dams /reservoirs in Popintsi, Average forest Central Balkan buffer the territory of the region – , Pyasach- and others. nik, Koprinka, Jrebchevo, Kardzhali, Studen Protected zone “Rice paddies Tsalapitsa” Cladenec, , Beglika, Belmeken, Bat- (BG 0002086) is a complex used for rice pro- ak, , Shiroka Poliana and others. In South duction watered areas surrounded by low dikes Central region are many mineral springs of na- and canals and grasslands located in the immedi- tional importance. Better known are Hisar, ate vicinity. It is part of the whole territory of the Banya (), , Devin, Bratsigo- rice fields located on part of the land of the com- vo Mihalkovo, , Merichleri, Narechen, pound of town and villages Tsalapitsa, Radinovo Krichim, , Haskovo mineral baths Voysil, Plovdiv district with a total area of 36 ha. and others. The area includes rice paddies, other extensive Natura 2000 is a European network made up cereals including rotational crops, arable land of protected areas designed to ensure long-term and water areas, including internal standing and survival of the most valuable and threatened spe- flowing water. The protected area is declared by cies and habitats for Europe in line with basic in- order of the Minister of Environment and Water. ternational agreements in the field of environ- Its aim is the protection and maintenance of hab- mental protection and biodiversity. Natura 2000 itats mentioned in the subject of the protection of is central to the policy of the European Union and bird species to achieve their favorable conserva- is a testament to the commitment of all Member tion status, and restoration of habitats of species States to work for the preservation of biodiver- for which it is necessary to improve the conser- sity. It is based on two key EU agreements relat- vation status. ing to environmental protection and biodiversity Rice paddies Tsalapitsa territory is located in a conservation – directive on the conservation of densely populated area and is under strong pres- wild birds and the Directive on the conservation sure of the intense human activities. The main of natural habitats and wild flora and fauna. They habitats are formed as a result of human activi- were transposed in Bulgarian legislation through ties and their existence largely depends on the ac- the Biodiversity Act. tive use of the land primarily related to rice pro- On the territory of the CSR covered many pro- duction. Business activities in significant part in- tected areas network “Natura 2000”: clude the growing of crops, 50% of the land in the

94 Икономика и управление на селското стопанство, 61, 2-4/2016 project area are occupied by the rice (Oriza sati- soil. Diffuse source of pollution resulting from va). Corn (Zea mays) represents 16% of the crops, the application of organic or mineral fertilizers alfalfa (Medicado sativa) is 18%, cereals (Poace- in quantities exceeding the needs of the crop of ae) are 8% and sunflower (Helianthus annuus) is nutrients or thin surface layer of soil, which can 2%. The remaining 2% included temporarily or not absorb nutrients. Contamination can occur permanently uncultivated areas. Key bird species when imported fertilizers in unsuitable soil or are the subject of conservation in the protected climatic conditions. If crops or pasture vegeta- zone. Types of art. 6, paragraph 1 pt. 3 of the Law tion are not able to absorb the available nutrients on Biological Diversity, subject to conservation it a significant part of them is lost through leak- and monitoring are those included in Annex II of age in the Polish drainage system in nearby riv- Directive 2009/147 / EC on the conservation of ers and lakes or penetrate into the deeper soil lay- wild birds and their habitats. On the territory of ers, which leads to contamination of groundwater the protected area established 17 species subject waters. Pollution carries risks for both the qual- to protection - Little Bittern, Little Egret, Great ity of the environment and to human health. The Egret, Black Stork, White Stork, Glossy Ibis, high content of nitrates in surface waters creates Marsh Harrier, Northern Harrier, Long-legged conditions for eutrophication, manifested in the Buzzard, Great Spotted Crake, Little Spotted appearance of excessive algae and other aquatic Crake, Kokilobegach, Pratincole, Barnacle Tern, plants that consume oxygen from the water and Kingfisher, Calandra Lark, Red-backed Shrike. lead to death or migration of fish and other aquat- The types of the biodiversity found in protected ic life. There is a possible mass growth of harm- areas was 11 - Grey Heron, Mallard, Garganey, ful algae that are toxic to humans and animals. Common Buzzard, Kestrel (Kestrels), Moor- So the waters are losing their economic impor- hen, Lapwing, Redshank, Large Wood Sandpip- tance as a resource for tourism, leisure and en- er, Caspian Gull. In case significant is the pro- tertainment. Even more dangerous might be the tection of areas in which during reproduction, high content of nitrates in water catchment areas moulting, wintering or migration gather signifi- for drinking water. In this case there are serious cant amounts of bird species than those listed in health risks. When the sources of nitrates waste Annex II of the Birds Directive. or manure, water can become contaminated with microorganisms or fecal bacteria. These waters The main public bads in the region are unsuitable for drinking unless purified appro- Application of larger quantities of nitroge- priately. nous fertilizers needed for crop development, There are various sources of air pollution as well as the misuse causes nitrate pollution in the SCPR as anthropogenic and natural ori- and soil and water (surface and underground). gin: burning of fossil fuels in electricity genera- The air can also be polluted by gaseous nitrogen tion, transport, industry and households, indus- losses when some types of fertilizers (eg. Urea) trial processes and solvent use, for example in were introduced at an inappropriate temperature the chemical and mining industries; Agriculture; and unsuitable soil. Point source pollution occurs waste treatment; volcanic eruptions, wind blew when to allow release or discharge of water pol- dust and emissions of volatile organic compounds lutants from a particular source, in this case ni- from plants are examples of natural sources of trates (eg leaching of manure from dung-heap). emissions. Usually it occurs as a result of omissions, negli- Business reflects adversely on soil resources gence and improper management and storage of in SCPR in three areas: reduction of arable land, organic fertilizers, but mostly due to the lack of increase of degraded lands (eroded surface water- facilities for this purpose. logged, acidic and salty) and soil pollution with Diffuse sources – this type of pollution is due heavy metals. Reducing soil fund is linked to the to the total leakage of water from the ground or withdrawal of land for construction of industrial from the general movement of nitrates in the facilities, roads, pipelines and others. Significant

95 Identification of Public Goods and Bads in South Central Planning Region in Bulgaria areas are withdrawn for urban sprawl, construc- and soil, burning and destruction of trees and tion of military facilities and others. bushes. High intensity of a negative impact in the Land degradation is associated primarily with region are characterized by activities such as the erosion. About 80% of agricultural land are under reorganization of agricultural land, hunting, trap- water erosion, and of these about 30% are sub- ping and poaching, burning reedbeds, damage by jected to wind erosion. Average relate 136.7 mil- wild animals. lion tons soil due to water erosion. Soil salinity is As a measure in the Regional Development closely correlated with irrigation, because it is not Plan of the South Central region includes con- properly regulate groundwater and consequent- struction of sewerage infrastructure and waste- ly increases their mineralization. Already men- water treatment facilities to reduce pollution tioned that salinisation accompany our most fer- loads, for example along the river. Maritsa, which tile soils used for intensive farming. The largest is recognized as one of the biggest environmental areas are salted in the Plovdiv region. The total problems of SCR. area of genetically acidic soils amounts to 56% of Climatic conditions, geology and significant the country. It is worrying that intensively develop deforestation create conditions for the occur- processes of secondary acidification in areas with rence of a number of exogenous morphogenetic active agriculture in SCPR – Plovdiv and Pazard- processes such as erosion, landslides, mud-rock zhik. Soil pollution with heavy metals is charac- flows, scree and rock falls that violate the stabil- teristic for areas with polluted air, significantly ity of the ground and require the holding of spe- disposal of waste water, intensive use of chemi- cial fortification activities in construction and cals for agriculture and busy roads. Contaminated other business activities. By landslides most af- farmland heavy metals amounted to about 470 ha fected road infrastructure, which necessitates an for the country. For SCPR highest proportion is in inventory and mapping the road sections which the region of Plovdiv and Haskovo. are most often subjected to landslides. These pro- Air and water pollution, soil pollution, land- cesses are usually activated after torrential rains. scape disfigurement and general environmental These protsesise usually intensify after torrential degradation as a result of human activity. rains. Sizeable landslide stituted under the locali- In a very large area within the region and large- ty “Goliamata niva” (“The great field”) in the vil- ly reported activities leading to a negative impact lage of Jyltusha, Municipality. Another on the environment. SCR is a densely populated landslide in neighborhood „Blackberries“ Ardi- area subject to high pressure from intense human no, caused by the collapse of the old galleries of activities, in particular agricultural activity and mine “Goroubso” as subsidence caused the for- the economic use of the land. mation of a crater with a diameter of 8 m and a Damage in the region expressed in the remov- depth of 6 m. al of landscape features (hedges, single trees and In South Central region are extracted and most groups) in the use of agricultural land as such; diverse mineral resources: coal, ore and industrial - Burning of stubble, pastures, of reedbeds minerals and mineral waters. Of importance are and coastal vegetation, often leads to expansion mainly ores copper, polymetallic (mainly mined of the fires; lead and zinc), iron, manganese and others. Ore- - Felling of trees and bushes; bearing areas are Balkan, Rhodope Srednogorian - Intensification of production associated with and metallogenic zones. Primary fuel mined in significant use of pesticides, fertilizers and chem- the region is lignite. The main deposits are in the icals causes a change in the quality of soil and southeastern part of the Upper Tracian Valley and water in rivers and artificial water bodies used Dimitrovgrad. Nonmetallic minerals are clays, indiscriminate means for pest control in agricul- perlite, feldspar, rock salt, rock building materi- ture. als (granite, rhyolite, syenite, marble, limestone, The most extensive influence in the region has marl, and dolomite). Most mining processes re- the use of pesticides, fertilizers, water pollution quire a huge amount of water to separate the pre-

96 Икономика и управление на селското стопанство, 61, 2-4/2016 cious metals from rock. This reduces the level of als (Poaceae) – 163 species. There have been 23 aquifers and difficult access to water, leading to Bulgarian and 93 Balkan endemics, but the per- drying up or reduction of local springs and a fall centage of endemic component is relatively low in the level of the wells. The waste products have – 5.9%, i.e. below the national average. This is a huge volume and in many cases contain heavy probably related to the lack of separate centers metals and other toxic chemicals that, if not prop- of speciation. The presence of endemic species erly secured and stored, leading to serious pollu- in some families is significant – yuryushki mul- tion of surface water and soil. Wastes from min- lein (Verbascum ju-ruk), rock mullein (Verbas- ing forever remain a place of formation and rep- cum rupestre) .They are prioritized for protection resent a potential threat for decades to come. in Bulgaria, according to the National Strategy Competition for land and water resources and for Biodiversity Conservation. Of special inter- pollution arising from mining, severely affect- est to scientists and environmentalists to special- ing the livelihoods of communities in the region ized cognitive and eco-tourism are 1,700 plants, who make a living mainly from agriculture and including 15 protected species of orchids in pro- livestock, directly dependent on the quality and tected natural areas: Bio-Reserve “hole” near quantity of local water and soil. Mining in areas Ivaylovgrad and the protected area “Lika foun- with high biodiversity can lead to loss of valuable tain” on the road a village fiddler. The number plant and animal species, due to shortage of wa- of faithful occurring species with significant con- ter due to absorption of much of the local water servation status is as follows: resources for mining, as well as the contamina- • 83 protected by the Biodiversity Act (14.2% tion from mining processes. Most mining activi- type of all protected plant species); ties leave irreparable wounds in the landscape – • 12 globally rare species included in the Ap- especially the open mines, storage sites of rock, pendix of the Habitats Directive; tailing ponds, roads, drilled specifically for the • 5 species included in Appendix №1 of the needs of mine and others. Bern Convention; • 13 threatened and 101 rare species included Location of the public goods and bads in in the Red Book of Bulgaria. the region The fauna is represented by deer, wild boar, Although /despite/ pollution in the area, there wild cat, jackal, fox and all kinds of raptors. It are numerous preserved environmentally clean supports 350 species of butterflies, 21 species of areas, mainly in mountainous areas - large part of fish, 10 species of amphibians, 26 reptile species, the Central Balkan National Park, part of the Rila 273 bird species and 59 mammal species. National Park and the entire array of the Rho- Here dwell rare bird species such as black ket- dopes. tle, American and Egyptian Vulture (near by vil- Sites within the ecological network shall be lage Plevun) small eagle, hawk, 19 species of determined in accordance with two major en- bats. Attraction is farmed in village Slaveevo gi- vironmental EU Directives – Directive 92/43 / ant turtle. EEC on the conservation of natural habitats and Primary for the Eastern Rhodopes for- of wild fauna and flora (hereinafter briefly Hab- est vegetation – old coniferous and deciduous itats Directive) and Directive 2009/147 / EC on forests, which determines the development of the conservation of wild birds (hereinafter brief- the timber. Common are residual forests com- ly Birds Directive). Both Directives have been posed almost exclusively of hairy and virgiliana transposed in Bulgarian legislation through the oak, eastern sycamore, pine, oak, oak, ash, horn- Biodiversity Act. beam and beech, thorn bushes and grass ecosys- Eastern Rhodopes are one of the country’s tems Belizmata, beard, bulbosa. More rarely are regions with the greatest biodiversity. The richest distributed cedars, six, birch and others. families were presented Asteraceae (Asteraceae) The most of the area is occupied by oak for- – 237 species, beans (Fabaceae) – 173 and Cere- ests. There are seven species of oak that make

97 Identification of Public Goods and Bads in South Central Planning Region in Bulgaria up pure and mixed forests. Beech forests which mainly ores copper, polymetallic (mainly mined play an essential role in snow in winter and reg- lead and zinc), iron, manganese and others. Ore- ulation of water regime, are preserved in the val- bearing areas are Balkan, Rhodope Srednogori- leys of Arda River and White River. Here meet an and metallogenic zones. Primary fuel mined and Mediterranean communities, dominated by in the region are lignite. The main deposits are evergreen flu verdure. Typical Mediterranean in the southeastern part of the Upper Valley and plants are: skleropoa (Scleropoa rigida), Aspara- Dimitrovgrad. Nonmetallic minerals are clays, gus fern (Asparagus acutifolius), zhaltuga (Geni- perlite, feldspar, rock salt, rock building materi- sta anatolica), Osyris alba. The composition of als (granite, rhyolite, syenite, marble, limestone, psevdomakvisite come less evergreen and other marl, dolomite). Mediterranean forms, but enough accompanying transitional Mediterranean species. These com- munities are found scattered in the most eastern Connection between landscape and the and northeastern parts of the subregion (eg. Ivay- public goods/bads lovgrad, Belorolyane, Mandritsa) evergreen and The region is among the richest biodiversity their appearance is determined by the flu (Philly- areas in the country. It covered a large part of the rea media), kukuch (Pistacia terebinthus), prick- Central Balkan National Park, part of the Rila Na- ly juniper (Juniperus oxycedrus) and others. their tional Park and the entire array of the Rhodopes. composition also includes hornbeam (Carpinus There are 11 reserve 9 maintained reserves, 155 orientalis), oak (Quercus pubescens), the thorn protected areas and 98 natural landmarks, locat- (Paliurus spina-christi), bulbosa (Poa bulbosa). ed in the region. In the area covered and most of Typical for the subregion are mesophyticcom- the protected areas Natura 2000 – 44.5% of those munities of oriental beech (Fagus orientalis), and in the country. xeromesophytic of oak (Quercus frainetto), Acer In the South Central region focuses the entire monspessulanum (Acer monspessulanum) and production of essential oils in the country, which oak (Quercus ceris). is considered the most unique sub-sector of Bul- There are also small patches of preserved for- garian industry. This is due to the fact that the ests of black pine (Pinus nigra). And afforestation area is Rose Valley, where thanks to the unique are made with white and black pine. combination of climate, soil and processing tech- About the bads: South Central region has nology, produces the highest quality rose oil in been identified as contaminated area in terms of the world. air, water and soil due to the location of a large In Rose Valley 25 towns and villages and 30 number of areas with cumulative environmental 000 people are associated with the cultivation problems - Plovdiv, Kardzhali, Dimitrovgrad and and processing a wide range of essential oils, . The pollution is mainly of sulfur di- which are produced essential oils, concretes, ex- oxide, nitrogen dioxide and particulate matter. tracts, absolutes, resinoids and rosewater. The Mining in areas with high biodiversity can lead annual production of rose oil and other essential to loss of valuable plant and animal species, due oils totaled 700–800 kg respectively. And 23–25 to shortage of water due to absorption of much of thounds tons, 95% of the production are for ex- the local water resources for mining, as well as port. Common areas of the rose gardens are about the contamination from mining processes. 20 000 ha, as most of them are over 20 years old. Most mining activities leave irreparable wounds The main problem is to highlight the need to en- in the landscape – especially the open mines, stor- courage manufacturers of oil-bearing crops for age sites of rock, tailing ponds, roads, drilled spe- planting again of existing fields and gardens. cifically for the needs of mine and others. There are various sources of air pollution In South Central region are extracted and most in the SCPR as anthropogenic and natural ori- diverse mineral resources: coal, ore and industrial gin: burning of fossil fuels in electricity genera- minerals and mineral waters. Of importance are tion, transport, industry and households, indus-

98 Икономика и управление на селското стопанство, 61, 2-4/2016 trial processes and solvent use, for example in Positive features of the South Central Plan- the chemical and mining industries; Agriculture; ning Region (SCPR) are varied terrain and good waste treatment; volcanic eruptions, wind blew weather conditions. dust and emissions of volatile organic compounds Some of the benefits arising directly from na- from plants are examples of natural sources of ture, because the environment in the region is emissions. very fertile, (and the land – fertile), but many of Business reflects adversely on soil resources in them are the result of agricultural activity in this SCR in three areas: reduction of arable land, in- region is high. Many public goods in the region crease of degraded lands (eroded surface water- are a direct result of land management, which is logged, acidic and salty) and soil pollution with high in this region. heavy metals. Reducing soil fund is linked to the The region has ancient coniferous forests and withdrawal of land for construction of industrial pastures, many rivers and many springs of na- facilities, roads, pipelines and others. Significant tional importance. Around rivers are valleys with areas are withdrawn for urban sprawl, construc- farmland. Many are also reservoirs in the territo- tion of military facilities and others. ry of the region. The terrain is extremely varied. Land degradation is associated primarily with The next step is to mix and match public erosion. About 80% of agricultural land are un- goods to a set, which will ensure the competitive der water erosion, and of these about 30% are advantage of the region. Public goods may have subjected to wind erosion. Average relate 136.7 an important role to play in the formation of the million tons soil due to water erosion. Soil salin- competitive advantages of the region. They as- ity is closely correlated with irrigation, because sist in the creation of business value in the busi- it is not properly regulate groundwater and con- ness sector and market development. When plan- sequently increases their mineralization. Already ning a business in a way that combines the pub- mentioned that salinisation accompany our most lic goods to market products allowing to achieve fertile soils used for intensive farming. The larg- the uniqueness of the proposed value. The pro- est areas are salted in the Plovdiv region. The posed model requires a coordinated approach to total area of genetically acidic soils amounts to the protection and conservation of these public 56% of the country. It is worrying that intensive- goods. To minimize the risk of their disability, it ly develop processes of secondary acidification in is necessary to involve all stakeholders. The use areas with active agriculture in SCPR – Plovdiv of the cluster approach would be appropriate to and Pazardzhik. achieve proper economic outcomes for partici- Soil pollution with heavy metals is charac- pants, as well as to realize the second-order ef- teristic for areas with polluted air, significantly fects with the non-economic nature of local so- disposal of waste water, intensive use of chemi- ciety. cals for agriculture and busy roads. Contaminat- ed farmland heavy metals amounted to about 470 References ha for the country. For SCPR highest proportion is in the region of Plovdiv and Haskovo. Bureau, J.-C., 2010. “La Politique Agricole Com- mune après 2013, les enjeux et la position des acteurs”, Futuribles, № 369, pp. 47-61 Conclusions Bureau, J.-C., Mahé, L.-P., 2008. “La réforme de There is a wide range of public goods related la PAC au-delà de 2013. Une vision à plus long terme”, to agriculture, many of which are highly valued pour “Notre Europe”, consultable sur: http://www.notre- europe.eu/media/Etud64-PAC-propostions-fr_01.pdf in the region. The most important are: agricultur- Cooper, T., Hart, K. and Baldock, D., 2009. The al landscape (landscape) topography, soil quali- Provision of Public Goods through Agriculture in the Eu- ty, farmland biodiversity, water quality, soil func- ropean Union, Report Prepared for DG Agriculture and tionality, climate stability, as well as the sustain- Rural Development, Contract No 30-CE-0233091/00-28, ability of floods and fires. Institute for European Environmental Policy: London.

99 Identification of Public Goods and Bads in South Central Planning Region in Bulgaria

Cornes, R. and Sandler, T., 2003. The Theory of Ex- Sustainable Food Supply Chain Commission (SFSCC; ternalities, Public Goods and Club Goods, 2nd Edition, 2015) Final report: The long and the short of it: sustain- Cambridge University Press. able food supply chains. Industry and Parliament Trust, Dwyer, J. and Hodge, I. D. H., 1996. Countryside London. in Trust: land management by conservation, amenity and recreation organisations. John Wiley and sons, Chich- ester. Identification of Public Goods and Bads Grouiez, P., 2014. Farming strategies regarding “so- in South Central Planning Region in cial responsibility” in the Russian agricultural sector. Bulgaria Economics and Business Vol. XVII – 2014, № 1. * Lefebvre, M., Espinosa, M., Gomez y Paloma, S., DIMITRE NIKOLOV ** Paracchini, M. L., Piorr, A., and Zasada, I., 2015. Ag- PETAR BORISOV TEODOR RADEV** ricultural landscapes as multi-scale public good and the *Institute of Agricultural Economics – Sofia, Bulgaria role of the Common Agricultural Policy. Journal of Envi- **Agricultural University – Plovdiv, Bulgaria ronmental Planning and Management, 58: 2088-2112 Musgrave, R., 1959. The theory of public finance: (Summary) A study un public economy. New York Mc Graw-Hill, 1959. The aim of the article is to outline public goods Ostrom, V., Ostrom, E., 1997. Public Goods and and bads from agriculture and forestry in the South Public Choices, in E. S. Savas (ed.) Alternatives for De- Central Planning Region. livering Public Services: Toward Improved Performance, There is a wide range of public bads and goods pp. 7-49. Boulder, CO: Westview Pres. related to agriculture. Many of public goods are Poux, X., 2012. “Justifier les aides environnementales highly valued in the region. The most important are: à l’agriculture sur le concept de biens publics et de ser- agricultural landscape / landscape / topography, soil vices rendus?”, Ecorev, № 38, p. 59-63 quality, farmland biodiversity, water quality, soil Samuelson, P. A., 1954. The Pure Theory of Public functionality, climate stability, as well as the sustain- Expenditure. The Review of Economics and Statistics, ability of floods and fires. Public goods are used as Volume 36, Issue 4 (Nov., 1954), 387-389 a term in socio-political contexts: things which are http://www.businessdictionary.com/definition/public- ‘for the common good’. Development of the PG con- good.html cept is a core in debates about future policy concerns http://www.tutor2u.net/economics/reference/public- maintenance of their availability and usage. We goods adopt the neoclassical economic approach in consid- OECD, 2013. Providing Agri-environmental Public eration of PG. Goods through Collective Action. 28 June 2013, OECD, Paris. Key words: public goods, agriculture

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