Public Ecosystem Services Research Articles

Inadequate Standards in the Valuation of Public Goods and Ecosystem Services: Why Economists, Environmental Scientists and Policymakers Should Care

Surveys of stated willingness to pay (WTP) are increasingly used to assess the value of public goods and ecosystem services. However, the currently dominant survey protocols and practices are inadequate. This is most evident from robust findings that the valuations are heavily influenced by the response options or response scales used in the valuation questions. The widely accepted survey guidelines do not require the validity tests and reporting standards that would be needed to make the uncertainty of the results transparent. The increasing use of inadequate survey results by policymakers threatens to undermine trust in environmental valuation, environmental policies, and political institutions. The objective of this paper is to explain the relevant issues and the available alternatives in survey-based valuation to a wider audience of non-specialized economists, environmental scientists, and policymakers.

High-resolution land value maps reveal underestimation of conservation costs in the United States

The justification and targeting of conservation policy rests on reliable measures of public and private benefits from competing land uses. Advances in Earth system observation and modeling permit the mapping of public ecosystem services at unprecedented scales and resolutions, prompting new proposals for land protection policies and priorities. Data on private benefits from land use are not available at similar scales and resolutions, resulting in a data mismatch with unknown consequences. Here I show that private benefits from land can be quantified at large scales and high resolutions, and that doing so can have important implications for conservation policy models. I developed high-resolution estimates of fair market value of private lands in the contiguous United States by training tree-based ensemble models on 6 million land sales. The resulting estimates predict conservation cost with up to 8.5 times greater accuracy than earlier proxies. Studies using coarser cost proxies underestimate conservation costs, especially at the expensive tail of the distribution. This has led to underestimations of policy budgets by factors of up to 37.5 in recent work. More accurate cost accounting will help policy makers acknowledge the full magnitude of contemporary conservation challenges and can help improve the targeting of public ecosystem service investments.

Exploring variability in rangeland soil organic carbon stocks across California (USA) using a voluntary monitoring network

Rangelands are an economically and ecologically important land type that make up more than 40% of California's land area. Protecting and, where appropriate, increasing soil organic carbon (SOC) stocks across these rangelands can help to promote on-site and public ecosystem services including forage production and climate change mitigation. A necessary step toward appropriately and effectively stewarding SOC is understanding baseline variability in SOC stocks and identifying how that variability relates to factors such as climate, soil texture, and topography. While these relationships have been examined at broader spatial scales and in other contexts, analysis for California's rangelands remains lacking. We leveraged a voluntary ecological monitoring program consisting of 45 working ranches to explore how SOC varies with geographic distance, climate, vegetation, soil type, and topography within and across three regions of California. We found that there was large variability in soil C stocks across the state, with the Central Coast region storing more SOC than the San Joaquin and Sacramento Valleys. Network-wide, SOC stocks ranged from 4.83 to 63.54 Mg ha−1 for 0–10 cm depth and 12.15–205.37 Mg ha−1 for 0–40 cm depth. As hypothesized, climate was the strongest predictor of SOC stocks across the entire network, and in general other predictor groups became more important at the regional level. Within each region, we found on average a sixfold difference in SOC stocks, with much of the variation unexplained by the predictor variables included. While some differences in SOC likely result from unaccounted variables such as soil mineralogy, conceivably some of the variation is also due to differences in past and current land use—indicating that there is potential to rebuild SOC through management.

Forest and land fires, toxic haze and local politics in Indonesia

Forest and land fires are among the major catastrophic events that occur in Indonesia. They are a major cause of deforestation and greenhouse gas emissions. Their multiple sources are most diverse and root in nature and society. The immediate fire effects directly and the long-term landscape ecosystem degradations indirectly cause major and persisting and serious problems of public health and ecosystem service. Smoke haze from the forest and land fires in Sumatra and Kalimantan in 2015 caused significant environmental and economic losses in Indonesia, Singapore and Malaysia. We describe the different types of land uses and land cover where fires and smoke haze took place, and how local politics have affected fire use from 2001 to 2017. We calculated hot spots from satellite imageries as proxies for fire occurrences and applied regression analysis to understand the link between fire and local politics in Sumatra and Kalimantan. The results show that the greatest frequency of hot spots occurred in wood and oil palm plantations and logging concessions (47%), followed by conservation areas (31%) and community land (22%). Local elections involve land transactions, and fires were used as a cheap way to increase the land value. The use of fire as means of land clearing was strongly influenced by local politics. Their frequency and abundance obviously increased about a year prior to local elections. The reasons behind the correlation need to be understood so that appropriate incentives and sanctions can be put in place and deter political leaders from using fire as an incentive to their advantage.

The role of dairy company policies in support of farm green infrastructure in the absence of government stewardship payments

Intensive dairy farming has substantial impacts on freshwater and terrestrial ecosystems. Determining how to mitigate them while increasing production is driving the quest for sustainable milk production internationally. Green infrastructure (G.I.) provides private and public ecosystem services, including mitigation of farming environmental impacts. However, there are implementation barriers among farmers. New Zealand government supports farmer self-regulation as long as farmers meet environmental targets. Farmers are neither compensated for reducing environmental impacts, nor for setting aside G.I. in support of nature conservation. Dairy companies are under increasing pressure to ensure socially acceptable milk production practices among farmer suppliers. They may play a role in encouraging farmers to implement G.I. as a way of helping farmers meet regulatory compliance, and best farming practice. Using a content analysis of company policies, the role of dairy companies in encouraging G.I. among farmers is explored. Results indicate companies are concerned about the effects, and perception, of poor environmental farming practices on their profitability, and have developed some riparian G.I. policies, with government and farmer support. However, policies are farm-focused and are limited to one year, and thus lack the capacity to encourage G.I. in support of key ecosystem services, such as water cleansing and support for indigenous biodiversity that require landscape scaled networks and longer periods. Even at the farm scale, a majority of companies lack policies that encourage significant G.I. networks. Policies suggest companies, and by extension farmers, lack sufficient motivation to protect or restore them voluntarily. Under these conditions, significant G.I. is unlikely to develop under self-regulation, unless supplemented through motivating government stewardship payments.

Evaluation of a dairy agri-environmental programme for restoring woody green infrastructure

ABSTRACTPastoral landscape woody vegetation provides ecosystem services, but potentially competes for space, light and nutrients that could provide additional farm production. A questionnaire determined the values and behaviours of New Zealand dairy farmers to evaluate voluntary agri-environmental programmes for restoring woody vegetation. Findings indicate the area is increasing, while the composition and configuration of networks are changing and redistributing. Farms with little are losing more, and those with more are gaining. Farmers are planting new areas to increase their public ecosystem services, but may not provide these services through planting and management. Barriers include insufficient private woody vegetation ecosystem services, and low rates of growth of native plants. Government incentive programmes are ineffective in overcoming barriers. Farmers may be motivated by stronger evidence of valued ecosystem services, information about their benefits and drawbacks and how to support services through planting and management. However, a targeted environmental stewardship scheme is required to overcome barriers to planting, with government and the dairy industry working together to develop and maintain a landscape-scaled woody vegetation network on private and public land. Such networks would build sustainability and resilience into dairy farming, leading to an equitably sharing of benefits and costs of their public ecosystem services.

Ecosystem Service Valuation for National Accounting: A Reply to Obst, Hein and Edens (2016)

While recent experimental frameworks for national ecosystem service accounting have shown substantial progress, in our view some crucial methodological issues remain that deserve further consideration before setting final standards. In response to the landmark work of Obst et al. (Environ Resour Econ 64:1–23, 2016. doi: 10.1007/s10640-015-9921-1 ), we provide arguments with regard to the suitability of particular valuation approaches. Generally, we agree that respective valuation methods need to produce values that are consistent with national accounting standards such as representing exchange values. However, we disagree with their conclusions regarding specific valuation techniques. Firstly, the circumstance that methods used for estimating shadow prices can also be used to derive consumer surplus does not justify the general exclusion of all shadow pricing methods for valuation of ecosystem services for national accounts, especially for public ecosystem services. Secondly, that preference-based methods can also be used to assess welfare changes does not imply that cost-based methods are generally better suited for ecosystem accounting. To the contrary, we see an essential need for preference information in accounting contexts. Thirdly, that accounting standards use a written-down replacement cost approach, does not mean ecosystem accounting requires to employ a replacement cost approach. To the contrary, we argue that assessing ecosystem degradation through restoration costs would be in line with writing down depreciation, but we also point to its limits.

English

In 2011, the country of Rwanda made a commitment to restore the productivity of 2 million hectares of degraded forest and agricultural land. Agroforestry and improved woodlot management activities were proposed to restore the ecological and economic productivity of agricultural and forestland in Rwanda, but the activities have not been evaluated in terms of their financial profitability, profitability risk, or ecological impacts despite being significant factors that influence the adoption decisions of smallholder landowners who occupy the majority of land in the country. This paper evaluates the two activities from the perspective of risk-averse smallholders to show whether or not the activities are likely to be adopted. The paper presents a methodology that combines enterprise budgets, biological production functions and Monte Carlo analysis in an expected utility framework to investigate the financial profitability, financial risk and ecological impacts of the activities in a smallholder context in four provinces of Rwanda. Risk is accounted for by charactering the variability of financial and ecological outcomes, including profitability, crop and timber yields, erosion and carbon storage. The distributions of net present values of each activity are estimated and compared using stochastic dominance and certainty equivalence criteria in order to rank the activities. The results show that both activities are too risky from the perspective of smallholders. Internalizing the value of public ecosystem services does not change the results. Key words: Forest landscape restoration, ecosystem services, land use, risk, stochastic dominance, international environmental policy, Monte Carlo analysis.

Payments for ecosystem services (PES): a flexible, participatory, and integrated approach for improved conservation and equity outcomes

Over the past 20 years, payments for ecosystem services (PES) has become increasingly popular as a mechanism to promote environmentally sustainable land-use practices, and a burgeoning literature has been produced on this policy approach. The goal of this paper is to offer a comprehensive review of this literature, and to focus on four major aspects of PES: (1) its efficiency in delivering environmental conservation, (2) its impacts on the well-being of local land users, (3) its interaction with local norms of distributive justice and environmental stewardship, and (4) its interplay with broader national policies and socio-economic trends. Two major insights are drawn from this review of the literature. First, the conceptualisation of PES according to the neoclassical economic theory of efficient market transactions and utilitarian human behaviour may be unrealistic and counterproductive. In terms of efficient financial transactions, the physical properties of public ecosystem services obstruct the voluntary establishment of PES schemes by direct beneficiaries, practical constraints exist on the enforcement of outcome-based conditionality, and efficiency goals may need to be partly sacrificed to prevent the exacerbation of social inequalities. In terms of human behaviour, land users’ actions are shaped not only by personal utility calculations, but also by intrinsic norms of distributive justice and environmental stewardship; the interaction of PES with these intrinsic norms can negatively impact on its local legitimacy and even ‘crowd out’ existing motivations for the conservation of nature. The second insight is that land users’ capacity to shift to sustainable land practices, while influenced by the direct payments, remains strongly determined by broader socio-economic trends and by national strategies for rural development and institutional reform. On the basis of these insights, a flexible, participatory, and integrated conceptualisation of PES that can better account for this range of physical, socio-economic, and normative factors is proposed here as more capable of delivering efficient, equitable, and resilient conservation outcomes.

Economic evaluation of ecosystem goods and services under different landscape management scenarios

Human-induced changes in the natural environment are affecting the provision of ecosystem goods and services (EGS). Land use plans rarely include the value of public ecosystem services such as climate regulation and biodiversity due to difficulties in valuing these services. In this study, we assessed total economic value for five important ecosystem goods and services under five future land-use scenarios using varying levels of costs, prices and discount rates. Results indicated that at higher discount rates normally applied to commercial activities, and assuming the current prices for goods and services, net present value (NPV) was highest for landscape management scenarios aimed at maximising agricultural production. Potential income from services such as carbon and biodiversity does not offset projected income lost from agriculture due to land-use changes. At higher discount rates, NPV was negative for the two scenarios aimed at enhancing the longer term ecological sustainability of the landscape. These results indicate that income from carbon sequestration and biodiversity conservation would need to be considerably higher than current levels in order to justify focusing management of this landscape on ecological outcomes. At lower discount rates (at levels normally associated with public investments), the more ecologically appropriate ‘mosaic farming system’ had the highest NPV, indicating that this type of system might be attractive for investors interested in longer term return horizons or wider public benefits. Higher income from carbon or biodiversity, or increased return from timber by using high value tree species, could potentially make more ecologically appropriate systems profitable at higher discount rates.

Environmental Law and Agroecology. Transdisciplinary Approach to Public Ecosystem Services as a New Challenge for Environmental Legal Doctrine

Agriculture, one of the oldest activities subject to legal regulation, is undergoing a revolutionary redefinition of its own identity. From a monofunctional idea (in which agriculture was exclusively focussed on producing goods for private use and on the economic remuneration of the producers) we have now passed to a multifunctional idea (in which agriculture is perceived as a source of providing the community with a series of public ecosystemic services, whose global value is inestimable). This change has been accompanied by the birth of a new interdisciplinary science: agroecology, established in the 1980's. Agroecology has progressively integrated the viewpoint of disciplines like agronomy, ecology, sociology, economy, philosophy, until it has become fully transdisciplinary. However, law has remained outside the lines of research of the young science agroecology. It is important to attempt to include the viewpoint of law within agroecology. In order to do so, legal practitioners should go beyond the current limits of the academic sectors and exceed the distinction between agricultural law and environmental law. A new analysis is necessary. A law of sustainable agricultural ecosystems has to be drawn up. More radically, the whole environmental law field has to be re-thought and reconstructed as a general law and special law of ecosystems, meaning suppliers of diversified public services. The general part of law of ecosystems should determine the common legal principles, which are valid for protecting all ecosystems. The special part of law of ecosystems should be divided into homogeneous areas, which correspond to the different types of ecosystems according to the classifications of ecology.

Cost-benefit analysis in the context of ecosystem services for human well-being: A multidisciplinary critique

This paper provides a critique of the cost-benefit analysis tool for ecosystem services policy evaluation. We argue that when applied to public ecosystem services, the theoretical assumptions that underlie economic valuation and cost-benefit analysis fail to fully acknowledge the multiple dimensions of human well-being, the plural forms of value articulation, the complex nature of ecosystems, the distributional biases of markets and the fairness implications of spatio-temporal framing. The current monistic utilitarian approach to ecosystem services policy evaluation should therefore be replaced by a pluralist framework composed of a heterogeneous set of value-articulating instruments that are appropriate to the specific context within which decision-making takes place. It is argued that within this pluralist framework cost-benefit analysis may remain an appropriate tool to examine the contingent trade-offs of local policies that have limited impacts on ecosystems and their services.

Harvesting in an integrated general equilibrium model

Harvesting of prey biomass is analyzed in an integrated ecological-economic system whose submodels, a predator–prey ecosystem and a simple economy, are microfounded dynamic general equilibrium models. These submodels are interdependent because the ecosystem responds to harvesting—through the reactions of optimizing individual organisms—by changing the provision of public ecosystem services to consumers. General analytical results are derived regarding the impact of harvesting policies on short-run equilibria of both submodels, on population dynamics, and on stationary states of the integrated model. A key insight is that prey biomass carries a positive ecosystem price which needs to be added as a tax mark-up to the economic price of harvested biomass to attain allocative efficiency. Further information on the dynamics is gained by resorting to numerical analysis of the policy regimes of zero harvesting, laissez-faire harvesting and efficient harvesting. It “... is a matter of weighing costs and benefits of taking action, whether the action is the “inert” one of leaving resources alone in order to conserve them, or whether it involves exploiting a resource ... for so-called material ends”. Pearce (1976, p. 320)

Directional Changes in Ecological Communities and Social‐Ecological Systems: A Framework for Prediction Based on Alaskan Examples

In this article we extend the theory of community prediction by presenting seven hypotheses for predicting community structure in a directionally changing world. The first three address well-studied community responses to environmental and ecological change: ecological communities are most likely to exhibit threshold changes in structure when perturbations cause large changes in limiting soil or sediment resources, dominant or keystone species, or attributes of disturbance regime that influence community recruitment. Four additional hypotheses address social-ecological interactions and apply to both ecological communities and social-ecological systems. Human responsiveness to short-term and local costs and benefits often leads to human actions with unintended long-term impacts, particularly those that are far from the site of decision making or are geographically dispersed. Policies are usually based on past conditions of ecosystem services rather than expected future trends. Finally, institutions that strengthen negative feedbacks between human actions and social-ecological consequences can reduce human impacts through more responsive (and thus more effective) management of public ecosystem services. Because of the large role that humans play in modifying ecosystems and ecosystem services, it is particularly important to test and improve social-ecological hypotheses as a basis for shaping appropriate policies for long-term ecosystem resilience.

Organizing a public ecosystem service economy for sustaining biodiversity

The core question this paper attempts to address is how social organization needs to respond to biodiversity features and functions in order to achieve its sustainable use. Scholars have suggested that the governance of complex systems should be dispersed across multiple centers of authority and that any regulative system needs as much variety in the actions that it can take as exists in the system it is regulating. Further, it has been argued that complex ecosystems and biodiversity can successfully be maintained by complex, polycentric, multi-layered governance systems which have a variety of response mechanisms. But how should polycentric governance of biodiversity be organized? Borrowing from the organization of public economies in metropolitan areas we distinguish between production and provision of public ecosystem services and suggest the direction of institutional change for the organization of a public ecosystem service economy. If the market alone cannot solve the allocation of public ecosystem services, economic efficiency criteria based on hypothetical markets are not sufficient. Therefore, we suggest design principles which go beyond economic efficiency and provide examples of the emergence of polycentric governance from an Ethiopian coffee forest conservation project.

Ecosystem and Economy: An Integrated Dynamic General Equilibrium Approach

A dynamic general equilibrium model is developed for analyzing economyecosystem interactions. It includes stock-flow relations of natural resources, species populations and pollution, and it provides a microfoundation of the growth of populations. Humans and (other) species compete for natural resources and (prey) biomass. Resource stocks, pollution and populations determine public ecosystem services which in turn affect all agents in both the ecosystem and the economy. We establish a benchmark market system encompassing Lindahl markets for ecosystem services and emission markets. We also analyze a system where those two types of markets break down (laissez-faire) and propose efficiency restoring policies.