Decision-Making Of Rural-urban Land Conversion At The Urban Fringe

Farmland value reflects the economic returns from the various products and services available from that land. Decision-makers make choices upon its economic value, ignoring its non-market value as groundwater recharge, nutrient cycling, reducing flood risk and preserving open space. Land conversion in the urban fringe is irreversible and uncertainty, as is often the case, land used for farm always gets lower profits than its urban use. More recently, more people are concerning with the farmland conversion at urban fringe.This paper considers decision-making process of rural-urban land conversion under irreversibility and uncertainty, then use the contingent valuation method (CVM) to estimate the non-market value of fannland at the urban fringe Of Hongshan District of Wuhan. Benefit-costs analysis technique has been adopted to evaluate the net profit of land conversion, based upon Arrow and Fisher's models on decision-making of resource develop/preservation, we build the model of decision-making on land conversions at the urban fringe. At last, we extend our concern and make exploration on the practical use of this theoretical model.