Non-market Ecosystem Services Research Articles

Quantifying ecosystem services trade-offs from agricultural practices

The concept of ecosystem services (ESS) is widely used to highlight the interdependencies between agricultural and environmental systems. However, few studies have attempted to quantify the potential of agriculture to produce multiple ESS, and to estimate the possibilities for joint production of marketed and non-marketed ESS. A quantification of the trade-offs between non-marketed ESS and production of farm commodities (marketed ESS) may help to better target agricultural policies.We use a well-established biophysical farm-systems model (APSIM) to estimate how alternative farm management practices affect the joint production of ESS on mixed crop-livestock farms in the wheatbelt of Western Australia. Our analysis quantifies the trade-offs between the supply of agricultural commodities (crop yields and livestock weight gain) and non-marketed ESS (groundcover, soil carbon, nitrogen supply, and water regulation). Win–win trade-offs between marketed and non-marketed ESS become apparent when the value of agricultural commodity production is monetised. This study shows that, in our study regions, increasing crop residue retention can jointly increase production value and improve ESS provision of groundcover, soil carbon and nitrogen supply. Conversely, increasing the use of perennial pastures in the farming mix results in negative trade-offs between production values and non-marketed ESS.

The role of benefit transfer in ecosystem service valuation

The demand for timely monetary estimates of the economic value of nonmarket ecosystem goods and services has steadily increased over the last few decades. This article describes the use of benefit transfer to generate monetary value estimates of ecosystem services specifically. The article provides guidance for conducting such benefit transfers and summarizes advancements in benefit transfer methods, databases and analysis tools designed to facilitate its application.

Ecosystem Services: Accounting Standards

In their Research Article “Bringing ecosystem services into economic decision making: Land use in the United Kingdom” (5 July, p. [45][1]), I. J. Bateman et al. demonstrate the importance of considering nonmarket ecosystem services in economic decision-making. It is an excellent example of the potential for national-level spatial analysis of economic and environmental information to inform policy choices. The drive to connect economic and environmental information mirrors the ongoing developments in environmental-economic accounting. Over the past 6 years, the international statistics community has led work to finalize an international standard—the UN System of Environmental-Economic Accounting (SEEA) ([ 1 ][2])—and to place the measurement of ecosystem services and ecosystem condition into a national accounting context ([ 2 ][3]). The development of these statistical frameworks provides the basis for compiling internationally comparable data sets at a national level on the relationship between the environment and economic activity. ![Figure][1] CREDIT: ISTOCKPHOTO Despite their common motivations, the approaches of Bateman et al. and the SEEA differ in the ways that they assign value to ecosystem services. Bateman et al. ground their analysis in welfare changes as a consequence of specific policy scenarios. The SEEA approach aims to record the “output” generated by ecosystems, given current uses of ecosystem capital; thus, monetary values represent exchange values consistent with the principles of national accounting. The SEEA approach provides a way to place welfare-based estimates in a broader context. According to Bateman et al. , the maximization of all monetary values leads to an increase of £19,606 million per year with a loss of £448 million in agricultural output [Table 3 in ([ 3 ][4])]. This loss equates to just over 2% of current UK agricultural output, and the overall impact of including nonmarket services as a proportion of GDP is an additional 1.3% ([ 3 ][4]). However, there are some important differences between the definitions of economic activity used by Bateman et al. and standard national accounting, which may limit the interpretation of such comparisons. By integrating estimates of ecosystem services within the framework of accepted economic data, the SEEA approach can provide additional impetus to mainstream these types of studies. Therefore, in addition to the calls by Bateman et al. to ensure the use of additional information on ecosystem services within standard decision-making, we call for investment to improve the quality of the underlying data within a widely accepted and integrated measurement framework such as the SEEA. The availability of quality data is an important precondition to analysis that should not be overlooked. 1. [↵][5] United Nations, European Commission, Food and Agriculture Organization of the United Nations, International Monetary Fund, Organisation for Economic Co-operation and Development, World Bank, “System of Environmental-Economic Accounting 2012: Central Framework, prepublication (white cover)” (2012); . 2. [↵][6] United Nations, European Commission, Organisation for Economic Co-operation and Development, World Bank, “System of Environmental-Economic Accounting 2012: Experimental Ecosystem Accounting, pre-publication (white cover)” (2013); [http://unstats.un.org/unsd/envaccounting/eea\_white\_cover.pdf][7]. 3. [↵][8] Office for National Statistics, Input-Output Supply and Use Tables—2013 Edition (2013). [1]: pending:yes [2]: #ref-1 [3]: #ref-2 [4]: #ref-3 [5]: #xref-ref-1-1 View reference 1 in text [6]: #xref-ref-2-1 View reference 2 in text [7]: http://unstats.un.org/unsd/envaccounting/eea_white_cover.pdf [8]: #xref-ref-3-1 View reference 3 in text

Quantification and valuation of ecosystem services in diverse production systems for informed decision-making

Abstract The empirical evidence of decline in ecosystem services (ES) over the last century has reinforced the call for ES quantification, monitoring and valuation. Usually, only provisioning ES are marketable and accounted for, whereas regulating, supporting and cultural ES are typically non-marketable and overlooked in connection with land-use or management decisions. The objective of this study was to quantify and value total ES (marketable and non-marketable) of diverse production systems and management intensities in Denmark to provide a basis for decisions based on economic values. The production systems were conventional wheat (Cwheat), a combined food and energy (CFE) production system and beech forest. Marketable (provisioning ES) and non-marketable ES (supporting, regulating and cultural) ES were quantified by dedicated on-site field measurements supplemented by literature data. The value of total ES was highest in CFE (US$ 3142 ha −1 yr −1 ) followed by Cwheat (US$ 2767 ha −1 yr −1 ) and beech forest (US$ 2328 ha −1 yr −1 ). As the production system shifted from Cwheat - CFE–beech, the marketable ES share decreased from 88% to 75% in CFE and 55% in beech whereas the non-marketable ES share increased to 12%, 25% and 45% of total ES in Cwheat, CFE and beech respectively, demonstrating production system and management effects on ES values. Total ES valuation, disintegrated into marketable and non-marketable share is a potential way forward to value ES and ‘tune’ our production systems for enhanced ES provision. Such monetary valuation can be used by policy makers and land managers as a tool to assess ES value and monitor the sustained flow of ES. The application of ES-based valuation for land management can enhance ES provision for maintaining the productive capacity of the land without depending on the external fossil-based fertilizer and chemical input.

Marketed outputs and non-marketed ecosystem services: the evaluation of marginal costs

We provide a new approach for assessing the cost effectiveness of green payment schemes. We allow for complementary, supplementary and competitive relationships between agricultural production and non-marketed ecosystem services generation. Our theoretical model distinguishes three theoretical cases depending on the minimum level of the non-marketed ecosystem services. These cases are empirically investigated using a flexible transformation function and farm-level panel data from the UK. We find that the biophysical connections between the non-marketed ecosystem services and market activities have important implications for marginal costs. , Oxford University Press.

Policy incentives for switchgrass production using valuation of non-market ecosystem services

This study presents a linear profit model with combined economic and environmental factors for a switchgrass-for-biofuels agricultural system in the southeastern U.S. The objectives are to establish conversion-to-switchgrass thresholds for various market prices and identify policy incentives that would ensure economic profit while also maximizing environmental benefits (carbon sequestration, displacement of fossil fuels) and minimizing negative impacts (global warming potential, nitrate loss). Weighting factors are chosen to represent incentives and penalties by assigning value to the impacts. With no other incentives, switchgrass market prices of at least $51 and $58/dton would be needed in order to make a profitable switch from corn/Conservation Reserve Program (CRP) lands and cotton, respectively. At a mid-range offering of $50/dton, feasible carbon credit prices of $3/ $8/ $23 per metric tonne CO2e would incentivize conversion from corn, CRP, or cotton, respectively. Similarly, a water quality penalty of $0.20/ $3/ $2 per kilogram NO3–N leached would incentivize the same conversions with resultant watershed improvement. At a lower price of $30/dton switchgrass, incentives based on valuation of ecosystem services begin to exceed feasible ranges of these valuations.

Biodiversity, poverty, and development

Biodiversity is crucial for the production of a range of marketed and non-marketed ecosystem goods and services. This paper reviews the empirical evidence for the role of terrestrial biodiversity and biodiversity conservation in economic development and poverty, at both the macro (e.g. country) and micro (e.g. farm) scales. It first examines general relationships between biodiversity and economic development before showing how biodiversity influences ecosystem services. Second, future scenarios and challenges for biodiversity and development are examined, given projections for further changes in global population, economic growth, and consumption. Third, the relationship between biodiversity protection and incomes is investigated. Two specific policies, protected areas and bioprospecting, are reviewed with respect to their impacts on the welfare of the resource-dependent poor. In conclusion, improvements in policy design and implementation could help minimize the possibility of earth's sixth mass extinction event, at least within a few generations, while ensuring that the poor are not made worse off as a result of policy implementation.

Global mechanisms for sustaining and enhancing PES schemes

An international payment for ecosystem service (IPES) schemes may be one of the only mechanisms available to stimulate the provision of vital non-marketed ecosystem services at the global level, as those nations that benefit from global ecosystem services (GES) cannot readily force other sovereign nations to provide them. Currently, international trade offers trillions of dollars in incentives for countries to convert natural capital into marketable goods and services, and few payments to entice countries to conserve natural capital in order to sustain critical non-marketed ecosystem services. We examine the biophysical characteristics of climate change and biodiversity to understand the obstacles to developing effective IPES schemes. We find that none of the existing schemes for providing GES are adequate, given the scale of the problem. A cap and auction scheme for CO 2 emissions among wealthy nations could fund IPES and simultaneously deter carbon emissions. To disburse funds, we should adapt Brazil's ICMS ecológico, and apportion available funds to targeted countries in proportion to how well they meet specific criteria designed to measure the provision of GES. Individual countries can then develop their own policies for increasing provision of these services, ensured of compensation if they do so. Indirect IPES should include funding for freely available technologies that protect or provide GES, such as the low carbon energy alternatives that will be essential for curbing climate change. Markets rely on the price mechanism to generate profits, which rations technology to those who can afford it, reducing adoption rates, innovation and total value.

Tools for assessment of human health dimensions in forests | Tools for assessment of human health dimensions in forests

Human health related to forests can be evaluated by Health Impact Assessment (HIA) methodologies and by using indicators of Sustainable Forest Management (SFM). The HIA systematically reviews the health aspects associated with a development policy, plan or project for a forested area, whereas the indicators of SFM can be used to monitor and give information on the existing forests, and their management, including planning. A prerequisite for the assessment of human health aspects in forestry context is defining the relevant indicators. The physical and mental aspects of human health as well as human diseases related to forest conditions are not covered comprehensively and in an operational way for use in current forest management. The health aspects need more multidisciplinary research on the cause-effect relationships between health, forest management and biodiversity. It is also necessary to develop methodologies for the estimation of the economic value of the non-market forest ecosystem services. This article outlines several possibilities to collaborate and develop joint approaches between forest and health sector to assess the health aspect in forests and to ensure that the health aspects in forest management are taken into consideration.

Agriculture and land use: Demand for and supply of agricultural commodities, characteristics of the farming and food industries, and implications for land use in the UK

Agriculture is the largest type of land use in the UK, accounting for about 77 per cent of the total area, compared with an average 50 per cent for the EU27. But in common with most high-income countries, agriculture's contribution to UK GDP and employment is low, at about 0.5 and 1.8 per cent, respectively, although the regional importance of the sector (and its associated food and farming industries) varies considerably. Of the 17.5 million ha used for agriculture, about 28 per cent is allocated to crops, and 67 per cent is grassland. The grassland includes 4.4 million ha of sole-owned rough grazing and 1.1 million ha of common land in mainly upland “disadvantaged areas,” primarily used for beef and sheep production. This has a major influence on land use, especially in the northern and western parts of the UK. From the 1930s until the mid-1980s, UK policy promoted increases in agricultural productivity to feed the nation from its own resources. An array of income and production support measures encouraged intensive farming, including a relative switch to arable farming in eastern areas. Since the early-1990s, policies have sought simultaneously to make UK agriculture internationally competitive and environmentally benign. These policies, evident in the Agenda 2000 Reforms of the Common Agricultural Policy, point the way forward for the future. It is likely that a greater distinction will emerge between policies to protect natural resources and enhance the flow of non-market ecosystem services from rural land, and agriculture and food policies intended to encourage an appropriate proportion of national food requirements to be met from domestic sources. It seems likely that over the next 50 years, the UK's land area will be required to deliver an increasingly diverse range of private and public goods to meet growing human needs and aspirations. This will require a balance of policy-driven goals and market forces. It will also need a much improved understanding of the trade-offs between food production and environmental goals and of the institutional arrangements required to achieve a balance of economic, social and environmental outcomes.

Policy design for a multifunctional landscape

Landscapes consisting of several elements, such as wetlands and forests, are multifunctional in nature and produce both market and non-market goods. The need for policies arises from the existence of non-market ecosystem services that are not traded and thereby generally not subject to economic trade-offs in landowner decision making. An efficient incentive scheme for producing both types of goods would require policy designed for each non-market good. However, this may result in high transaction costs, possibly giving second-best solutions a comparative advantage when only one non-market good is regulated. This paper demonstrates that in the Hovran catchment area in mid Sweden, which produces the non-market goods water quality, biodiversity, and scenic beauty, compensation payments for biodiversity production alone provide almost maximum total net value of all market and non-market goods. On the other hand, payments for providing scenic beauty in the form of open landscape may result in lower total net value than no compensation payment at all, due to a negative impact on water quality.

Ecosystem services and regional development: An application to Sweden

This study carries out interregional comparisons of development and sustainable use of natural capital with and without inclusion of non-marketed ecosystem services. A simple dynamic model of an open economy shows that appropriate adjustment of conventional income accounts includes flow and stock components, but excludes explicit entrance of pollution. Calculations are made for Swedish regions and for two types of ecosystem services — pollution sequestration and recreational services — provided by three types of ecosystems: forests, agricultural landscape and wetlands. When comparing the adjusted and non-adjusted regional income accounts it is shown that the two measurements generate significantly different pictures of regional income and growth; regions that are traditionally considered as relatively less growth promoting are shown to hold important sources of wealth from natural capital, while counties that are rich in conventional accounts fall behind when adjusting for values of changes in natural capital.

The Value of Producing Food, Energy, and Ecosystem Services within an Agro-Ecosystem

Agricultural ecosystems produce food, fiber, and non-marketed ecosystem services (ES). Agriculture also typically involves high negative external costs associated with, for example, fossil fuel use. We estimated, via field-scale ecological monitoring and economic value-transfer methods, the market and nonmarket ES value of a combined food and energy (CFE) agro-ecosystem that simultaneously produces food, fodder, and bioenergy. Such novel CFE agro-ecosystems can provide a significantly increased net crop, energy, and nonmarketed ES compared with conventional agriculture, and require markedly less fossil-based inputs. Extrapolated to the European scale, the value of nonmarket ES from the CFE system exceeds current European farm subsidy payments. Such integrated food and bioenergy systems can thus provide environmental value for money for European Union farming and nonfarming communities.

Economic Impacts of Invasive Species in Forests

Biological invasions by nonnative species are a by-product of economic activities, with the vast majority of nonnative species introduced by trade and transport of products and people. Although most introduced species are relatively innocuous, a few species ultimately cause irreversible economic and ecological impacts, such as the chestnut blight that functionally eradicated the American chestnut across eastern North America. Assessments of the economic costs and losses induced by nonnative forest pests are required for policy development and need to adequately account for all of the economic impacts induced by rare, highly damaging pests. To date, countrywide economic evaluations of forest-invasive species have proceeded by multiplying a unit value (price) by a physical quantity (volume of forest products damaged) to arrive at aggregate estimates of economic impacts. This approach is inadequate for policy development because (1) it ignores the dynamic impacts of biological invasions on the evolution of prices, quantities, and market behavior, and (2) it fails to account for the loss in the economic value of nonmarket ecosystem services, such as landscape aesthetics, outdoor recreation, and the knowledge that healthy forest ecosystems exist. A review of the literature leads one to anticipate that the greatest economic impacts of invasive species in forests are due to the loss of nonmarket values. We proposed that new methods for evaluating aggregate economic damages from forest-invasive species need to be developed that quantify market and nonmarket impacts at microscales that are then extended using spatially explicit models to provide aggregate estimates of impacts. Finally, policies that shift the burden of economic impacts from taxpayers and forest landowners onto parties responsible for introducing or spreading invasives, whether through the imposition of tariffs on products suspected of imposing unacceptable risks on native forest ecosystems or by requiring standards on the processing of trade products before they cross international boundaries, may be most effective at reducing their impacts.

Jointness in production and farmers' willingness to supply non-marketed ecosystem services

This paper highlights how farmers' willingness to supply non-marketed ecosystem services (ES) is influenced by whether or not the non-marketed ES are produced jointly with agricultural products. When marketed products and non-marketed ES share some production inputs the production relationships between the two may be complementary, competitive or substitutive. Using a cost minimization framework, it is shown how complementary relationships lead to costless voluntary provision of non-marketed ES (typically the case for ES that are supportive of provisioning ES for marketed farm products). It is also shown how competitive production relationships lead to provision of non-marketed ES at lower cost than when non-marketed ES are direct substitutes for farm products or are produced outside of agriculture. The paper closes by showing how the minimum willingness to accept (WTA) payment for ES that are complementary/competitive is less than or equal to the minimum WTA for the same ES produced in substitute or independent production relationships.

The ecological, economic, and social importance of the oceans

The oceans have long been recognized as one of humanity’s most important natural resources. Their vastness has made them appear to be limitless sources of food, transportation, recreation, and awe. The difficulty of fencing and policing them has left them largely as open access resources to be exploited by anyone with the means. However, in recent times we have begun to reach the limits of the oceans and must now begin to utilize and govern them in a more sustainable way. This paper summarizes emerging information on the interrelated ecological, economic, and social importance of the oceans, and on developing institutions for their sustainable governance. In addition to their traditional importance as sources of primary and secondary production, and biodiversiy, the importance of the oceans in global material and energy cycles is now beginning to be better appreciated. Integrated models of the global ocean–atmosphere–terrestrial biosphere system reveal the critical role of the oceans in atmospheric gas and climate regulation, and for water, nutrient, and waste cycling. Recent estimates of the economic value of the marketed and non-marketed ecosystem services of the oceans indicate a huge contribution to human welfare from the functions mentioned above plus raw materials, recreational, and cultural services. The oceans have been estimated to contribute a total of ∼21 trillion US$/year to human welfare (compared with a global GNP of ∼25 trillion US$), with ∼60% of this from coastal and shelf systems and the other 40% from the open ocean, and with the oceans contributing ∼60% of the total economic value of the biosphere (Costanza et al., 1997. The value of the world’s ecosystem services and natural capital. Nature 387, 253-260). The social importance of the oceans for global transportation and as a unifying element in the cultures of many coastal countries cannot be overestimated. However, the cultural traditions of open access must be replaced with more appropriate property rights regimes and governance structures. Some alternative sustainable governance ideas are briefly discussed, emphasizing the need for an expanded deliberative process to develop a shared vision of a sustainable use of oceans.

ECONOMIC VALUATION OF FRESHWATER ECOSYSTEM SERVICES IN THE UNITED STATES: 1971–1997

The purpose of this paper is to provide ecologists and resource managers with a sense of where the economic science of ecosystem valuation has come from and where it might go in the future. To accomplish this, the paper provides a comprehensive synthesis of peer-reviewed economic data on surface freshwater ecosystems in the United States and examines major accomplishments and gaps in the literature. Economic value has been assigned to nonmarket goods and services provided by surface freshwater systems in the United States by 30 published, refereed articles in the scientific literature from 1971 to 1997. These studies have used variations of three approaches for a quantitative assessment of economic value: travel cost methods, hedonic pricing methods, and contingent valuation methods. To determine the economic value of nonmarket ecosystem goods and services, each method focuses on a different aspect of social benefit associated with lakes, streams, rivers, and wetlands. Valuation methodologies work from different underlying assumptions while possessing unique limitations and uncertainties. Dollar benefit estimates derived for nonmarket freshwater ecosystem goods and services from these studies tend to be specific to a particular method, ecosystem, and socioeconomic circumstance. Creative interdisci- plinary research is needed on the quantitative measurement of surface freshwater ecosystem goods and service values, the relation of these values to key limnological variates, and communication of limnological insights to the public and social scientists in ways that facilitate and improve future management and research.