Valuing Ecosystem Services Toward Better Environmental Decision-Making (2005) / Chapter Skim
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7 Ecosystem Valuation: Synthesis and Future Directions
7 Ecosystem Valuation: Synthesis and Future Directions
Pages 239-260
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From page 239... ...
Uncertainty and judgments that arise when conducting an ecosystem valuation study and affect the measurement of values are discussed in Chapter 6. The purpose of this final chapter is to synthesize the current knowledge regarding ecosystem valuation in a way that will be useful to resource managers and policymakers as they seek to incorporate the value of ecosystem services into their decisions.
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From page 240... ...
2. In addition, many people value the existence of aquatic ecosystems for their own sake, or for the role they play in ensuring the preservation of plant and animal species whose existence is important to them.
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8. Because aquatic ecosystems are complex, dynamic, variable, inter connected, and often nonlinear, our understanding of the services they pro vide, as well as how they are affected by human actions, is imperfect and linkages are difficult to quantify.
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SYNTHESIS OF MAJOR CONCLUSIONS The preceding general premises collectively imply that ecosystem valuation can play an important role in policy evaluation and policy and resource management decisions. The following section provides a synthesis of the major conclusions regarding ecosystem valuation that emerge from the previous chapters.
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From page 243... ...
However, the complexity of ecosystems remains a barrier to quantifying the links from ecosystem structure and functions to the goods and services that humans value. In addition, although there is now widespread recognition that ecosystem services are "valuable," simply recognizing them as valuable may be insufficient as a guide to environmental policy choice.
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From page 244... ...
Economic theory suggests that willingness to accept is appropriate for valuing the removal of a service to which people have a right, whereas willingness to pay is appropriate for valuing the provision of a new service or more of an existing service in a situation where there is no right to receive this service, although in practice most economic valuation exercises use methodologies that measure only willingness to pay. Nonetheless, because willingness to pay provides a lower bound for willingness to accept, it is a sufficient measure for cases in which willingness-to-pay estimates exceed the value of alternatives.
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From page 245... ...
, it would still be appropriate to use a positive or negative discount rate for the benefits or costs associated with changes in ecosystem services, if the general availability of these services is expected to change over time. It is important to note, however, that because they are conducted at the present time, all valuation exercises measure the values or preferences of the current generation.
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. Most economic valuation exercises to date have been of this type.
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Economic valuation can also be an important input into environmental policy choice when a particular service (such as water purification) must be provided and one way to provide it is through protection, preservation, or restoration of ecosystem services.
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However, the effect of this change on other ecosystem services would not be included in the value estimates derived from the travel-cost method. Averting behavior models are best suited for valuing ecosystem services related to human health or the provision of related services such as clean water.
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From page 249... ...
into values is greatly simplified because market prices can be used as measures of value, at least for small changes. The more challenging aspect of these studies is determining policy recommendations for managing the aquatic ecosystems supporting the key ecosystem service or services of interest and, in turn, translating the change in ecosystem services into a change in the availability or cost of producing the marketed good or service.
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However, as Chapters 3-5 of this report have emphasized, this interconnectedness may matter more than previously thought in valuing the different services of aquatic ecosystems, and the challenge to economists and ecologists is to collaborate on developing more integrated ecological-economic modeling of the importance of ecosystem functioning, structure, and habitat/production functions for various ecosystem services of value to humankind. Regardless of the methods used, there are some issues that should be considered in the design of any ecosystem valuation study.
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From page 251... ...
A fourth key issue is selection of the appropriate temporal scale for the valuation exercise, which allows for consideration of future impacts of current policy choices. As noted previously, when impacts occur over time, a comparison and aggregation of present and future values is necessary, which is typically done through the use of discounting.
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From page 252... ...
These changes and the changes in implicit or explicit prices that can result are not captured by the valuation techniques. Second, in terms of ecological impacts, aquatic ecosystems can exhibit threshold effects and large changes can push the system over a threshold, causing regime shifts (e.g., from an oligotrophic to a eutrophic state)
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GUIDELINES/CHECKLIST FOR VALUATION OF ECOSYSTEM SERVICES The preceding synthesis of the report's major conclusions regarding ecosystem valuation suggests that a number of issues or factors enter into the appropriate design of a study of the value of a change in aquatic ecosystem services. The context of the study and the way in which the resulting values will be used play a key role in determining the type of value estimate that is needed.
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· How precisely can the changes in ecological services that are likely to result from the policy be predicted? o Is the level of precision sufficient given the nature and purpose of the valuation exercise?
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If so, what discount rate is used? What are the implications for intergenerational resource allo cation using alternative decision rules?
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However, when policymakers are concerned about trade-offs, then the valuation of services provided by ecosystems can inform the policy debate and lead to improved decision-making. Based on the information provided in this report, the committee has identified a number of overarching recommendations regarding the valuation of ecosystem services in such contexts.
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From page 257... ...
In particular, it should seek to value the changes in ecosystem services attributable to the policy change, rather than the value of an entire ecosystem. · A valuation exercise should recognize and delineate explicitly the sources of value from the ecosystem and identify which sources are and which are not captured in the economic approach to valuation.
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The committee believes that funding to address these needs is necessary if progress toward improving the use of ecosystem valuation in policy decisions is to be made, and it recommends that such funding be a high priority. · Improved documentation of the potential of various aquatic ecosystems to provide goods and services and the effect of changes in ecosystem structure and functions on this provision · Increased understanding of the effect of changes in human actions on ecosystem structure and functions · Increased interdisciplinary training and collaborative interaction among economists and ecologists · Development of a more explicit and detailed mapping between ecosystem services as typically conceived by ecologists and the services that people value (and hence to which economic valuation approaches or methods can be applied)
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From page 259... ...
Ecosystem Valuation: Synthesis and Future Directions 259 · Improved understanding of the spatial and temporal thresholds for various ecosystems, and development of methods to assess and incorporate into valuation the uncertainties arising from the complex dynamic and nonlinear behavior of many ecosystems · Improvements in the methods for assessing and incorporating uncertainty and irreversibility into valuation studies
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