Gross domestic product (GDP) summarizes a vast amount of economic information in a single monetary metric that is widely used by decision makers around the world. However, GDP fails to capture fully ...the contributions of nature to economic activity and human well-being. To address this critical omission, we develop a measure of gross ecosystem product (GEP) that summarizes the value of ecosystem services in a single monetary metric. We illustrate the measurement of GEP through an application to the Chinese province of Qinghai, showing that the approach is tractable using available data. Known as the “water tower of Asia,” Qinghai is the source of the Mekong, Yangtze, and Yellow Rivers, and indeed, we find that water-related ecosystem services make up nearly two-thirds of the value of GEP for Qinghai. Importantly most of these benefits accrue downstream. In Qinghai, GEP was greater than GDP in 2000 and three-fourths as large as GDP in 2015 as its market economy grew. Large-scale investment in restoration resulted in improvements in the flows of ecosystem services measured in GEP (127.5%) over this period. Going forward, China is using GEP in decision making in multiple ways, as part of a transformation to inclusive, green growth. This includes investing in conservation of ecosystem assets to secure provision of ecosystem services through transregional compensation payments.
Coronavirus has claimed the lives of over half a million people world-wide and this death toll continues to rise rapidly each day. In the absence of a vaccine, non-clinical preventative measures have ...been implemented as the principal means of limiting deaths. However, these measures have caused unprecedented disruption to daily lives and economic activity. Given this developing crisis, the potential for a second wave of infections and the near certainty of future pandemics, lessons need to be rapidly gleaned from the available data. We address the challenges of cross-country comparisons by allowing for differences in reporting and variation in underlying socio-economic conditions between countries. Our analyses show that, to date, differences in policy interventions have out-weighed socio-economic variation in explaining the range of death rates observed in the data. Our epidemiological models show that across 8 countries a further week long delay in imposing lockdown would likely have cost more than half a million lives. Furthermore, those countries which acted more promptly saved substantially more lives than those that delayed. Linking decisions over the timing of lockdown and consequent deaths to economic data, we reveal the costs that national governments were implicitly prepared to pay to protect their citizens as reflected in the economic activity foregone to save lives. These ‘price of life’ estimates vary enormously between countries, ranging from as low as around $100,000 (e.g. the UK, US and Italy) to in excess of $1million (e.g. Denmark, Germany, New Zealand and Korea). The lowest estimates are further reduced once we correct for under-reporting of Covid-19 deaths.
The complex real-world interactions between the economy and the environment form both the focus of and main barrier to applied research within the field of environmental economics. However, ...geographical information systems (GIS) allow economists to tackle such complexity head on by directly incorporating diverse datasets into applied research rather than resorting to simplifying and often unrealistic assumptions. This innovative book applies GIS techniques to spatial cost-benefit analysis of a complex and topical land use change problem - the conversion of agricultural land to multipurpose woodland - looking in detail at issues such as opportunity costs, timber yield, recreation, carbon storage, etc., and embracing cost-cutting themes such as the evaluation of environmental preferences and the spatial transfer of benefit functions.
The paper seeks to contribute to the expanding literature on ecosystem service assessment by considering its integration with economic analyses of such services. Focussing upon analyses for future ...orientated policy and decision making, we initially consider a single period during which ecological stocks are maintained at sustainable levels. The flow of ecosystems services and their contribution to welfare bearing goods is considered and methods for valuing resultant benefits are reviewed and illustrated via a case study of land use change. We then broaden our time horizon to discuss the treatment of future costs and benefits. Finally we relax our sustainability assumption and consider economic approaches to the incorporation of depleting ecological assets with a particular focus upon stocks which exhibit thresholds below which restoration is compromised.
The central challenge of the 21st century is to develop economic, social, and governance systems capable of ending poverty and achieving sustainable levels of population and consumption while ...securing the life-support systems underpinning current and future human well-being. Essential to meeting this challenge is the incorporation of natural capital and the ecosystem services it provides into decision-making. We explore progress and crucial gaps at this frontier, reflecting upon the 10 y since the Millennium Ecosystem Assessment. We focus on three key dimensions of progress and ongoing challenges: raising awareness of the interdependence of ecosystems and human well-being, advancing the fundamental interdisciplinary science of ecosystem services, and implementing this science in decisions to restore natural capital and use it sustainably. Awareness of human dependence on nature is at an all-time high, the science of ecosystem services is rapidly advancing, and talk of natural capital is now common from governments to corporate boardrooms. However, successful implementation is still in early stages. We explore why ecosystem service information has yet to fundamentally change decision-making and suggest a path forward that emphasizes: (i) developing solid evidence linking decisions to impacts on natural capital and ecosystem services, and then to human well-being; (ii) working closely with leaders in government, business, and civil society to develop the knowledge, tools, and practices necessary to integrate natural capital and ecosystem services into everyday decision-making; and (iii) reforming institutions to change policy and practices to better align private short-term goals with societal long-term goals.
We present an experiment designed to investigate the presence and nature of ordering effects within repeat-response stated preference (SP) studies. Our experiment takes the form of a large sample, ...full-factorial, discrete choice SP exercise investigating preferences for tap water quality improvements. Our study simultaneously investigates a variety of different forms of position-dependent and precedent-dependent ordering effect in preferences for attributes and options and in response randomness. We also examine whether advanced disclosure of the choice tasks impacts on the probability of exhibiting ordering effects of those different types. We analyze our data both non-parametrically and parametrically and find robust evidence for ordering effects. We also find that the patterns of order effect in respondents' preferences are significantly changed but not eradicated by the advanced disclosure of choice tasks a finding that offers insights into the choice behaviors underpinning order effects.
Marine coastal ecosystems, commonly referred to as blue ecosystems, provide valuable services to society but are under increasing threat worldwide due to a variety of drivers, including ...eutrophication, development, land‐use change, land reclamation, and climate change. Ecological restoration is sometimes necessary to facilitate recovery in coastal ecosystems. Blue restoration (i.e., in marine coastal systems) is a developing field, and projects to date have been small scale and expensive, leading to the perception that restoration may not be economically viable. We conducted a global cost–benefit analysis to determine the net benefits of restoring coral reef, mangrove, saltmarsh, and seagrass ecosystems, where the benefit is defined as the monetary value of ecosystem services. We estimated costs from published restoration case studies and used an adjusted‐value‐transfer method to assign benefit values to these case studies. Benefit values were estimated as the monetary value provided by ecosystem services of the restored habitats. Benefits outweighed costs (i.e., there were positive net benefits) for restoration of all blue ecosystems. Mean benefit:cost ratios for ecosystem restoration were eight to 10 times higher than prior studies of coral reef and seagrass restoration, most likely due to the more recent lower cost estimates we used. Among ecosystems, saltmarsh had the greatest net benefits followed by mangrove; coral reef and seagrass ecosystems had lower net benefits. In general, restoration in nations with middle incomes had higher (eight times higher in coral reefs and 40 times higher in mangroves) net benefits than those with high incomes. Within an ecosystem type, net benefit varied with restoration technique (coral reef and saltmarsh), ecosystem service produced (mangrove and saltmarsh), and project duration (seagrass). These results challenge the perceptions of the low economic viability of blue restoration and should encourage further targeted investment in this field.
Análisis de Rentabilidad Espacial de la Restauración Azul y de los Factores Determinantes del Beneficio Neto Mundial
Resumen
Los ecosistemas costeros marinos, llamados comúnmente ecosistemas azules, proporcionan servicios valiosos para la sociedad, pero se encuentran bajo una amenaza creciente a nivel mundial causada por una variedad de determinantes, incluyendo la eutrofización, el desarrollo, el cambio en el uso de suelo, la reclamación de tierra y el cambio climático. Algunas veces se necesita de la restauración ecológica para facilitar la recuperación en los ecosistemas costeros. La restauración azul (es decir, en los sistemas costeros marinos) es un campo en desarrollo, con proyectos que a la fecha han sido a pequeña escala y costosos, lo que resulta en la percepción de que la restauración puede no ser viable económicamente. Realizamos un análisis de rentabilidad mundial para determinar los beneficios netos de la restauración de ecosistemas de arrecife de coral, manglar, marisma y pastos marinos en donde el beneficio está definido como el valor monetario de los servicios ambientales. Estimamos los costos a partir de estudios de caso de restauración publicados y usamos un método de transferencia de valor ajustado para asignar los valores de beneficio a estos estudios de caso. Los valores de los beneficios fueron estimados como el valor monetario proporcionado por los servicios ambientales de los hábitats restaurados. Los beneficios superaron los costos (es decir, fueron beneficios netos positivos) de la restauración de todos los ecosistemas azules. El beneficio promedio consistió en que la proporción de costos para la restauración del ecosistema fue 8‐10 veces mayor que en los estudios anteriores de la restauración de los arrecifes de coral y los pastos marinos, probablemente debido a que usamos estimaciones de costo más bajas. Entre los ecosistemas, las marismas tuvieron los mayores beneficios netos seguidos por los manglares; los arrecifes de coral y los pastos marinos tuvieron los beneficios netos más bajos. En general, la restauración en los países con niveles medios de ingreso tuvo más beneficios netos (ocho veces más en los arrecifes de coral y 40 veces más en los manglares) que aquellos países con niveles altos de ingreso. En cuanto al tipo de ecosistema, el beneficio neto varió de acuerdo con la técnica de restauración (arrecife de coral y marisma), servicio ambiental producido (manglar y marisma) y duración del proyecto (pastos marinos). Estos resultados desafían las percepciones de la baja viabilidad económica que tiene la restauración azul y deberían fomentar una mayor inversión focalizada en este campo.
Article impact statement: Blue restoration produces net benefits for all ecosystems assessed. Net benefits are driven by technique, duration, and ecosystem services.
This paper develops a spatially disaggregated, structural econometric model of agricultural land use and production based on the joint multi-output technology representation introduced by Chambers ...and Just (1989). Starting from a flexible specification of the farm profit function, we derive land use allocation, input application, crop yield, and livestock intensity equations in a joint and theoretically consistent framework. To account for the presence of censored observations in micro-level data, the model is estimated as a system of two-limit Tobit equations via quasi-maximum likelihood. We present an empirical application using fine-scale spatial data covering the entirety of England and Wales and including the main economic, policy, and environmental drivers of land use change in the past forty years. A simulation of the effects of diffuse pollution reduction measures illustrates how our approach can be applied for agro-environmental policy appraisal.
Despite heightened awareness of the need to find additional resources for tropical biodiversity conservation, and recognition that the benefits to populations in developed countries may be ...significant, very few empirical studies have been conducted to estimate these values. In this article, we report the results of a choice experiment survey that investigated the preferences of UK residents for the conservation of threatened wildlife in the Eastern Arc Mountains in Tanzania, part of the Eastern Afromontane “biodiversity hotspot”. We examine the sensitivity of values to species types, the number of species, the number of conservation sites and, more unusually, to potential substitutes/complements. Critically we find some evidence of coherency in preferences. Respondents are willing to pay significant, positive amounts to conserve charismatic and/or endemic species and are scope sensitive to the number of endemic species. In contrast, species which are neither endemic nor charismatic, and the number of conservation sites, do not contribute significantly to utility. Further, changing the overall scope of the ‘good’ is found to have a significant and differential impact on respondent's choices depending on the species type: as the availability of wildlife increases, we observe substitution effects for non-endemic charismatic species, and complementarity for endemic (non-charismatic) species.
► Choice experiment to examine UK preferences for wildlife conservation in Africa. ► Some evidence of coherency in preferences. ► WTP significantly influenced by number of species, charisma and endemism. ► Substitution effects for charismatic non-endemics and complementarity for endemic non-charismatics.
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