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Valuation of Marine Ecosystems  

Achilleas Vassilopoulos and Phoebe Koundouri

Water accounts for more than 70% of Earth’s surface, making marine ecosystems the largest and most important ecosystems of the planet. However, the fact that a large part of these ecosystems and their potential contribution to humans remains unexplored has rendered them unattractive for valuation exercises. On the contrary, coastal zones, , being the interface between the land, the sea, and human activities competing for space and resources, have been extensively studied with the objective of marine ecosystem services valuation. Examples of marine and coastal ecosystems are open oceans, coral reefs, deep seas, hydrothermal vents, abyssal plains, wetlands, rocky and sandy shores, mangroves, kelp forests, estuaries, salt marshes, and mudflats. Although there are arguments that no classification can capture the ways in which ecosystems contribute to human well-being and support human life, very often policymakers have to decide upon alternative uses of such natural environments. Should a given wetland be preserved or converted to agricultural land? Should a mangrove be designated within the protected areas system or be used for shrimp farming? To answer these questions, one needs first to establish the philosophical basis of value within the ecosystems framework. To this end, two vastly different approaches have been proposed. On the one hand, the nonutilitarian (biocentric) approach relies on the notion of intrinsic value attached to the mere existence of a natural resource, independent of whether humans derive utility from its use (if any) or preservation. Albeit useful in philosophical terms, this approach is still far from providing unambiguous and generally accepted inputs to the tangible problem of ecosystem valuation. The utilitarian (anthropocentric) perspective, on the other hand, assumes that natural environments have value to the extent that humans derive utility from placing such value. According to the total economic value (TEV) approach, this value can be divided into “use” and “nonuse.” Use values involve some interaction with the resource, either directly or indirectly, while nonuse values are derived simply from the knowledge that natural resources and aspects of the natural environment are maintained. Existence and altruistic values fall within this latter category. Not surprisingly, economists have long revealed a strong preference for the utilitarian approach. As a result, the valuation of marine ecosystems requires that we understand the ecosystem services they deliver and then attach a value to the services. But what tools are available to economists when valuing marine ecosystems? For the most part, ecosystem services are not traded in formal markets and thus actual prices are usually not available. Valuation techniques essentially seek different ways to estimate measures like Willingness To Pay (WTP), Willingness To Accept (WTA), or expenditures and costs. The techniques used for the valuation of ecosystem services can be divided into three main families: market-based, revealed preference, and stated preference. Finally, value-transfer methods are also used when estimates of value are available in similar contexts. All these methods have advantages and disadvantages, with different methods being suitable for different situations. Hence, extra caution is required during the design and implementation of valuation attempts.


Deliberative Monetary Valuation  

Bartosz Bartkowski and Nele Lienhoop

While economic values of nonmarket ecosystem goods and services are in high demand to inform decision-making processes, economic valuation has also attracted significant criticism. Particularly, its implicit rationality assumptions and value monism gave rise to alternative approaches to economic nonmarket valuation. Deliberative monetary valuation (DMV) originated in the early 2000s and gained particular prominence after 2010, especially in the context of the United Kingdom National Ecosystem Assessment (UK NEA). It constitutes a major methodological development to overcome the limitations of conventional nonmarket valuation methods by incorporating deliberative group elements (information provision, discussion, time to reflect in a group setting) in the valuation process. DMV approaches range from those that focus on facilitating individual preference formation for complex and unfamiliar environmental changes and stay close to neoclassical economic theory to those that try to go beyond methodological individualism and monetary valuation to include a plurality of different values. The theoretical foundation of DMV comprises a mix of economic welfare theory, on the one hand, and various strands of deliberative democratic theory and discourse ethics, on the other. DMV formats are mostly inspired by deliberative institutions such as citizens’ juries and combine those with stated preference methods such as choice experiments. While the diversity of approaches within this field is large, it has been demonstrated that deliberation can lead to more well-informed and stable preferences as well as facilitate the inclusion of considerations going beyond self-interest. Future research challenges surrounding DMV include the exploration of intergroup power relations and group dynamics as well as the theoretical status and the validity of DMV results.


Valuation of Mangrove Restoration  

Edward B. Barbier

Since the 2004 Indian Ocean tsunami, there has been strong interest globally in restoring mangrove ecosystems and their potential benefits from protecting coastlines and people from damaging storms. However, the net economic gains from mangrove restoration have been variable; there have been some notable project successes but also some prominent failures. There is also an ongoing debate over whether or not the cost of mangrove restoration is justified by the benefits these ecosystems provide. Although the high costs of mangrove restoration and the risk of failure have led to criticism of such schemes, perhaps the more pertinent concern should be whether the ex post option of restoration is economically beneficial compared to preventing irreversible mangrove conversion to alternative land uses. Case studies on mangrove valuation from Brazil and Thailand illustrate the key issues underlying this concern. Since much recent mangrove restoration has been motivated by the trees’ potential storm-protection benefit, a number of studies have valued mangroves for this purpose. However, mangroves are also valued for other important benefits, such as providing collected products for local coastal communities and serving as nursery and breeding grounds for off-shore fisheries. The implications of these benefits for mangrove restoration can be significant. It is also important to understand the appropriate use of benefit transfer when it is difficult to value restored mangroves, methods to incorporate the potential risk of mangrove restoration failure, and assessment of cost-effective mangrove restoration.


Valuation of Rainforest Preservation in the Amazon  

Jon Strand

Different ecosystem values of the Amazon rainforest are surveyed in economic terms. Spatial rainforest valuation is crucial for good forest management, such as where to put the most effort to stop illegal logging and forest fires, and which areas to designate as new nationally protected areas. Three classes of economic value are identified, according to who does the valuation: values accruing to the local and regional populations (of South America); carbon values (which are global); and other global (noncarbon) values. Only the first two classes are discussed. Three types of value are separated according to ecosystem service delivered from the rainforest: provisioning services; supporting and regulating services; and cultural and other human services. Net values of provisioning services, including reduced impact logging and various non-timber forest products, are well documented for the entire Brazilian Amazon at a spatially detailed scale and amount to at least $20–50/ha/year. Less-detailed information exists about values of fish, game, and bioprospecting from the Amazon, although their total values can be shown to be sizable. Many supporting and regulating services are harder to value economically, in particular climate regulation and watershed and erosion protection. Impacts of changed rainfall when Amazon rainforest is lost have been valued at detailed scale, but with relative model values of $10–20/ha/year. Carbon values are much larger, at a carbon price of $30/ton CO2, around $14,000/ha as capitalized value. The average per-hectare value of tourism and the health benefits from having the Amazon forest are low, and such values cannot easily be pinned down to individual areas of the Amazon. Finally, the biodiversity values of the Amazon, as accruing to the local and regional population, seem to be small based on recent stated-preference work in Brazil. Most of the values related to biodiversity are likely to be global and may. in principle, be very large, but the global components are not valued here. The concept of value is discussed, and a marginal valuation concept (practically useful for policy) is favored as opposed to an average or total valuation. Marginal value can be below average value (as is likely for biodiversity and tourism), but can also in some contexts be higher. This can occur where losing forest at a local scale increases the prevalence of forest fires and where it increases forest dryness, leading to a multiplier process whereby more forest is lost. While strides have recently been made to improve rainforest valuation at both micro- and macroscales, much work still remains.


Payments for Ecosystem Services: Program Design and Participation  

Natasha James and Erin Sills

Payments for ecosystem or environmental services (PES) are broadly defined as payments (in kind or in cash) to participants (often landowners) who volunteer to provide the services either to a specific user or to society at large. Payments are typically conditional on agreed rules of natural resource management rather than on delivery of the services. The rules range from protection of native ecosystems to installation of conservation practices. The earliest proponents of PES were economists who argued that they are a cost-effective way to conserve forests, manage watersheds, and protect biodiversity. Political support for PES rests on the claim that these programs can alleviate poverty among participants as well as protect the environment. More recent literature and experience with PES reveals barriers to achieving cost-effectiveness and poverty alleviation, including many related to the distribution of participation. The Costa Rican experience illustrates the choices that must be made and the potential for innovation in the design of PES programs.


Ecosystem Services into Water Resource Planning and Management  

Phoebe Koundouri, Angelos Alamanos, Kostas Dellis, Conrad Landis, and Artemis Stratopoulou

The broad economic notion of ecosystem services (ES) refers to the benefits that humans derive, directly or indirectly, from ecosystem functions. Provisioning ES refer to human-centered benefits that can be extracted from nature (e.g., food, drinking water, timber, wood fuel, natural gas, oils, etc.), whereas regulating ES include ecosystem processes that moderate natural phenomena (pollination, decomposition, flood control, carbon storage, climate regulation, etc.). Cultural ES entail nonmaterial benefits accruing to the cultural advancement of people, such as the role of ecosystems in national and supranational cultures, recreation, and the spur of knowledge and creativity (music, art, architecture). Finally, supporting ES refer to the main natural cycles that nature needs to function, such as photosynthesis, nutrient cycling, the creation of soils, and the water cycle. Most ES either depend on or provide freshwater services, so they are linked to water resources management (WRM). The concept of ES initially had a pedagogical purpose to raise awareness on the importance of reasonable WRM; later, however, it started being measured with economic methods, and having policy implications. The valuation of ES is an important methodology aimed at achieving environmental, economic and sustainability goals. The total economic value of ecosystems includes market values (priced) as well as nonmarket values (not explicit in any market) of different services for humanity’s benefit. The valuation of ES inherently reflects human preferences and perceptions regarding the contribution of ecosystems and their functions to the economy and society. The ES concept and associated policies have been criticized on the technical weaknesses of the valuation methods, interdisciplinary conflicts (e.g., ecological vs. economic perception of value), and ethical aspects on the limits of economics, nature’s commodification, and its policy implications. Since valuation affects the incentives and policies aimed at conserving key ES, e.g., through payment schemes, it is important to understand the way that humans decide and develop preferences under uncertainty. Behavioral economics attempts to understand human behavior and psychology and can help to identify appropriate institutions and policies under uncertainty that enhance ecosystem services that are key to WRM.


Environmental Accounting  

Jean-Louis Weber

Environmental accounting is an attempt to broaden the scope of the accounting frameworks used to assess economic performance, to take stock of elements that are not recorded in public or private accounting books. These gaps occur because the various costs of using nature are not captured, being considered, in many cases, as externalities that can be forwarded to others or postponed. Positive externalities—the natural resource—are depleted with no recording in National Accounts (while companies do record them as depreciation elements). Depletion of renewable resource results in degradation of the environment, which adds to negative externalities resulting from pollution and fragmentation of cyclic and living systems. Degradation, or its financial counterpart in depreciation, is not recorded at all. Therefore, the indicators of production, income, consumption, saving, investment, and debts on which many economic decisions are taken are flawed, or at least incomplete and sometimes misleading, when immediate benefits are in fact losses in the long run, when we consume the reproductive functions of our capital. Although national accounting has been an important driving force in change, environmental accounting encompasses all accounting frameworks including national accounts, financial accounting standards, and accounts established to assess the costs and benefits of plans and projects. There are several approaches to economic environmental accounting at the national level. Of these approaches, one purpose is the calculation of genuine economic welfare by taking into account losses from environmental damage caused by economic activity and gains from unrecorded services provided by Nature. Here, particular attention is given to the calculation of a “Green GDP” or “Adjusted National Income” and/or “Genuine Savings” as well as natural assets value and depletion. A different view considers the damages caused to renewable natural capital and the resulting maintenance and restoration costs. Besides approaches based on benefits and costs, more descriptive accounts in physical units are produced with the purpose of assessing resource use efficiency. With regard to natural assets, the focus can be on assets directly used by the economy, or more broadly, on ecosystem capacity to deliver services, ecosystem resilience, and its possible degradation. These different approaches are not necessarily contradictory, although controversies can be noted in the literature. The discussion focuses on issues such as the legitimacy of combining values obtained with shadow prices (needed to value the elements that are not priced by the market) with the transaction values recorded in the national accounts, the relative importance of accounts in monetary vs. physical units, and ultimately, the goals for environmental accounting. These goals include assessing the sustainability of the economy in terms of conservation (or increase) of the net income flow and total economic wealth (the weak sustainability paradigm), in relation to the sustainability of the ecosystem, which supports livelihoods and well-being in the broader sense (strong sustainability). In 2012, the UN Statistical Commission adopted an international statistical standard called, the “System of Environmental-Economic Accounting Central Framework” (SEEA CF). The SEEA CF covers only items for which enough experience exists to be proposed for implementation by national statistical offices. A second volume on SEEA-Experimental Ecosystem Accounting (SEEA-EEA) was added in 2013 to supplement the SEEA CF with a research agenda and the development of tests. Experiments of the SEEA-EEA are developing at the initiative of the World Bank (WAVES), UN Environment Programme (VANTAGE, ProEcoServ), or the UN Convention on Biological Diversity (CBD) (SEEA-Ecosystem Natural Capital Accounts-Quick Start Package [ENCA-QSP]). Beside the SEEA and in relation to it, other environmental accounting frameworks have been developed for specific purposes, including material flow accounting (MFA), which is now a regular framework at the Organisation for Economic Co-operation and Development (OECD) to report on the Green Growth strategy, the Intergovernmental Panel on Climate Change (IPCC) guidelines for the the UN Framework Convention on Climate Change (UNFCCC), reporting greenhouse gas emissions and carbon sequestration. Can be considered as well the Ecological Footprint accounts, which aim at raising awareness that our resource use is above what the planet can deliver, or the Millennium Ecosystem Assessment of 2005, which presents tables and an overall assessment in an accounting style. Environmental accounting is also a subject of interest for business, both as a way to assess impacts—costs and benefits of projects—and to define new accounting standards to assess their long term performance and risks.


Ecosystem Services  

Leon C. Braat

The concept of ecosystem services considers the usefulness of nature for human society. The economic importance of nature was described and analyzed in the 18th century, but the term ecosystem services was introduced only in 1981. Since then it has spurred an increasing number of academic publications, international research projects, and policy studies. Now a subject of intense debate in the global scientific community, from the natural to social science domains, it is also used, developed, and customized in policy arenas and considered, if in a still somewhat skeptical and apprehensive way, in the “practice” domain—by nature management agencies, farmers, foresters, and corporate business. This process of bridging evident gaps between ecology and economics, and between nature conservation and economic development, has also been felt in the political arena, including in the United Nations and the European Union (which have placed it at the center of their nature conservation and sustainable use strategies). The concept involves the utilitarian framing of those functions of nature that are used by humans and considered beneficial to society as economic and social services. In this light, for example, the disappearance of biodiversity directly affects ecosystem functions that underpin critical services for human well-being. More generally, the concept can be defined in this manner: Ecosystem services are the direct and indirect contributions of ecosystems, in interaction with contributions from human society, to human well-being. The concept underpins four major discussions: (1) Academic: the ecological versus the economic dimensions of the goods and services that flow from ecosystems to the human economy; the challenge of integrating concepts and models across this paradigmatic divide; (2) Social: the risks versus benefits of bringing the utilitarian argument into political debates about nature conservation (Are ecosystem services good or bad for biodiversity and vice versa?); (3) Policy and planning: how to value the benefits from natural capital and ecosystem services (Will this improve decision-making on topics ranging from poverty alleviation via subsidies to farmers to planning of grey with green infrastructure to combining economic growth with nature conservation?); and (4) Practice: Can revenue come from smart management and sustainable use of ecosystems? Are there markets to be discovered and can businesses be created? How do taxes figure in an ecosystem-based economy? The outcomes of these discussions will both help to shape policy and planning of economies at global, national, and regional scales and contribute to the long-term survival and well-being of humanity.


Deforestation of the Brazilian Amazon  

Phillip Fearnside

Deforestation in Brazilian Amazonia destroys environmental services that are important for the whole world, and especially for Brazil itself. These services include maintaining biodiversity, avoiding global warming, and recycling water that provides rainfall to Amazonia, to other parts of Brazil, such as São Paulo, and to neighboring countries, such as Argentina. The forest also maintains the human populations and cultures that depend on it. Deforestation rates have gone up and down over the years with major economic cycles. A peak of 27,772 km2/year was reached in 2004, followed by a major decline to 4571 km2/year in 2012, after which the rate trended upward, reaching 7989 km2/year in 2016 (equivalent to about 1.5 hectares per minute). Most (70%) of the decline occurred by 2007, and the slowing in this period is almost entirely explained by declining prices of export commodities such as soy and beef. Government repression measures explain the continued decline from 2008 to 2012, but an important part of the effect of the repression program hinges on a fragile base: a 2008 decision that makes the absence of pending fines a prerequisite for obtaining credit for agriculture and ranching. This could be reversed at the stroke of a pen, and this is a priority for the powerful “ruralist” voting bloc in the National Congress. Massive plans for highways, dams, and other infrastructure in Amazonia, if carried out, will add to forces in the direction of increased deforestation. Deforestation occurs for a wide variety of reasons that vary in different historical periods, in different locations, and in different phases of the process at any given location. Economic cycles, such as recessions and the ups and downs of commodity markets, are one influence. The traditional economic logic, where people deforest to make a profit by producing products from agriculture and ranching, is important but only a part of the story. Ulterior motives also drive deforestation. Land speculation is critical in many circumstances, where the increase in land values (bid up, for example, as a safe haven to protect money from hyperinflation) can yield much higher returns than anything produced by the land. Even without the hyperinflation that came under control in 1994, highway projects can yield speculative fortunes to those who are lucky or shrewd enough to have holdings along the highway route. The practical way to secure land holdings is to deforest for cattle pasture. This is also critical to obtaining and defending legal title to the land. In the past, it has also been the key to large ranches gaining generous fiscal incentives from the government. Money laundering also makes deforestation attractive, allowing funds from drug trafficking, tax evasion, and corruption to be converted to “legal” money. Deforestation receives impulses from logging, mining, and, especially, road construction. Soybeans and cattle ranching are the main replacements for forest, and recently expanded export markets are giving strength to these drivers. Population growth and household dynamics are important for areas dominated by small farmers. Extreme degradation, where tree mortality from logging and successive droughts and forest fires replace forest with open nonforest vegetation, is increasing as a kind of deforestation, and is likely to increase much more in the future. Controlling deforestation requires addressing its multiple causes. Repression through fines and other command-and-control measures is essential to avoid a presumption of impunity, but these controls must be part of a broader program that addresses underlying causes. The many forms of government subsidies for deforestation must be removed or redirected, and the various ulterior motives must be combated. Industry agreements restricting commodity purchases from properties with illegal deforestation (or from areas cleared after a specified cutoff) have a place in efforts to contain forest loss, despite some problems. A “soy moratorium” has been in effect since 2006, and a “cattle agreement” since 2009. Creation and defense of protected areas is an important part of deforestation control, including both indigenous lands and a variety of kinds of “conservation units.” Containing infrastructure projects is essential if deforestation is to be held in check: once roads are built, much of what happens is outside the government’s control. The notion that the 2005–2012 deforestation slowdown means that the process is under control and that infrastructure projects can be built at will is extremely dangerous. One must also abandon myths that divert efforts to contain deforestation; these include “sustainable logging” and the use of “green” funds for expensive programs to reforest degraded lands rather than retain areas of remaining natural forests. Finally, one must provide alternatives to support the rural population of small farmers. Large investors, on the other hand, can fend for themselves. Tapping the value of the environmental services of the forest has been proposed as an alternative basis for sustaining both the rural population and the forest. Despite some progress, a variety of challenges remain. One thing is clear: most of Brazil’s Amazonian deforestation is not “development.” Trading the forest for a vast expanse of extensive cattle pasture does little to secure the well-being of the region’s rural population, is not sustainable, and sacrifices Amazonia’s most valuable resources.


The Economics of Marine Reserves  

Venetia Alexa Hargreaves-Allen

Marine protected areas (MPAs) remain one of the principal strategies for marine conservation globally. MPAs are highly heterogeneous in terms of physical features such as size and shape, habitats included, management bodies undertaking management, goals, level of funding, and extent of enforcement. Economic research related to MPAs initially measured financial, gross, and net values generated by the habitats, most commonly fisheries, tourism, coastal protection, and non-use values. Bioeconomic modeling also generated important insights into the complexities of fisheries-related outcomes at MPAs. MPAs require a significant investment in public funds for design, designation, and ongoing management, which have associated opportunity costs. Therefore cost-benefit analysis has been increasingly required to justify this investment and demonstrate their benefits over time. The true economic value of MPAs is the value of protection, not the resource being protected. There is substantial evidence that MPAs should increase recreational values due to improvements in biodiversity and habitat quality, but assumptions that MPAs will generate such improvements may not be justified. Indeed, there remains no equivocal demonstration of spillover in fisheries adjacent to MPAs, due in part to the variability inherent in ecological and socio-economic processes and limited evidence of tourism benefits that are biologically or socio-cultural sustainable. There is a need for carefully designed valuation studies that compare values for areas within MPAs compared the same areas without management (the counterfactual scenario). The ecosystem service framework has become widely adopted as a way of characterizing goods and services that contribute directly or indirectly to human welfare. Quantitative analyses of the marginal changes to ecosystem services due to MPAs remains rare due to the requirements of large amounts of fine-grained data, relatively undeveloped bio-physical models for the majority of services, and the complexities of incorporating ecological nonlinearities and threshold effects. In addition while some services are synergistic (so that double counting is difficult to avoid), others are traded off. Such marginal ecosystem service values are highly context specific, which limits the accuracy associated with benefits transfer. A number of studies published since 2000 have made advances in this area, and this is a rapidly developing field of research. While MPAs have been promoted as a sustainable development tool, there is evidence of significant distributive impacts of MPAs over time, over different time scales and between different stakeholders, including unintended costs to local stakeholders. Research suggests that support and compliance is predicated on the costs and benefits generated locally, which is a major determinant of MPA performance. Better understanding of socio-economic impacts will help to align incentives with MPA objectives. Further research is needed to value supporting and regulating services and to elucidate how ecosystem service provision is affected by MPAs in different conditions and contexts, over time and compared to unmanaged areas, to guide adaptive management.


The Oceans and Human Health  

Lora Fleming, Michael Depledge, Niall McDonough, Mathew White, Sabine Pahl, Melanie Austen, Anders Goksoyr, Helena Solo-Gabriele, and John Stegeman

The interdisciplinary study of oceans and human health is an area of increasing global importance. There is a growing body of evidence that the health of the oceans and that of humans are inextricably linked and that how we interact with and affect our oceans and seas will significantly influence our future on earth. Since the emergence of modern humans, the oceans have served as a source of culture, livelihood, expansion, trade, food, and other resources. However, the rapidly rising global population and the continuing alterations of the coastal environment are placing greater pressure on coastal seas and oceans. Negative human impacts, including pollution (chemical, microbial, material), habitat destruction (e.g., bottom trawling, dredging), and overfishing, affect not only ecosystem health, but also human health. Conversely, there is potential to promote human health and well-being through sustainable interactions with the coasts and oceans, such as the restoration and preservation of coastal and marine ecosystems. The study of oceans and human health is inherently interdisciplinary, bringing together the natural and social sciences as well as diverse stakeholder communities (including fishers, recreational users, private enterprise, and policymakers). Reviewing history and policy with regard to oceans and human health, in addition to known and potential risks and benefits, provides insights into new areas and avenues of global cooperation, with the possibility for collaboratively addressing the local and global challenges of our interactions with the oceans, both now and in the future.


Urban Landscapes and Green Infrastructure  

Stephan Pauleit, Rieke Hansen, Emily Lorance Rall, Teresa Zölch, Erik Andersson, Ana Catarina Luz, Luca Szaraz, Ivan Tosics, and Kati Vierikko

Urban green infrastructure (GI) has been promoted as an approach to respond to major urban environmental and social challenges such as reducing the ecological footprint, improving human health and well-being, and adapting to climate change. Various definitions of GI have been proposed since its emergence more than two decades ago. This article aims to provide an overview of the concept of GI as a strategic planning approach that is based on certain principles. A variety of green space types exist in urban areas, including remnants of natural areas, farmland on the fringe, designed green spaces, and derelict land where successional vegetation has established itself. These green spaces, and especially components such as trees, can cover significant proportions of urban areas. However, their uneven distribution raises issues of social and environmental justice. Moreover, the diverse range of public, institutional, and private landowners of urban green spaces poses particular challenges to GI planning. Urban GI planning must consider processes of urban change, especially pressures on green spaces from urban sprawl and infill development, while derelict land may offer opportunities for creating new, biodiverse green spaces within densely built areas. Based on ample evidence from the research literature, it is suggested that urban GI planning can make a major contribution to conserving and enhancing biodiversity, improving environmental quality and reducing the ecological footprint, adapting cities to climate change, and promoting social cohesion. In addition, GI planning may support the shift toward a green economy. The benefits derived from urban green spaces via the provision of ecosystem services are key to meeting these challenges. The text argues that urban GI planning should build on seven principles to unlock its full potential. Four of these are treated in more detail: green-gray integration, multifunctionality, connectivity, and socially inclusive planning. Considering these principles in concert is what makes GI planning a distinct planning approach. Results from a major European research project indicate that the principles of urban GI planning have been applied to different degrees. In particular, green-gray integration and approaches to socially inclusive planning offer scope for further improvement In conclusion, urban GI is considered to hold much potential for the transition toward more sustainable and resilient pathways of urban development. While the approach has developed in the context of the Western world, its application to the rapidly developing cities of the Global South should be a priority.


Environmental Footprints of Modernization Trends in Rice Production Systems of Southeast Asia  

Reiner Wassmann

Assessing the environmental footprints of modern agriculture requires a balanced approach that sets the obviously negative effects (e.g., incidents with excessive use of inputs) against benefits stemming from increased resource use efficiencies. In the case of rice production, the regular flooding of fields comprises a distinctive feature, as compared to other crops, which directly or indirectly affects diverse impacts on the environment. In the regional context of Southeast Asia, rice production is characterized by dynamic changes in terms of crop management practices, so that environmental footprints can only be assessed from time-dependent developments rather than from a static view. The key for the Green Revolution in rice was the introduction of high-yielding varieties in combination with a sufficient water and nutrient supply as well as pest management. More recently, mechanization has evolved as a major trend in modern rice production. Mechanization has diverse environmental impacts and may also be instrumental in tackling the most drastic pollution source from rice production, namely, open field burning of straw. As modernization of rice production is imperative for future food supplies, there is scope for developing sustainable and high-yielding rice production systems by capitalizing on the positive aspects of modernization from a local to a global scale.


Environmental Economics of Pollination  

Antoine Champetier

The pollination of crops by domesticated bees and wild pollinators is easily and often imagined as an accidental but essential process in agriculture. The notion that pollinators are overlooked despite their essential role in food production is widespread among the general public, as well as in policy debates concerning all issues related to pollinators, ranging from regulation of pesticides to conservation of habitat for wild bees, to support of beekeeping as an industry or as a hobby. Meade was the first to formalize this notion by making pollination a canonical example of beneficial externality in economics and arguing that subsidies should be established to ensure that honeybees are provided in optimal numbers to pollinate crops. In the first two decades of the 21st century, the same argument, but this time focusing on wild pollinators, has been proposed and supported by a large and growing literature in conservation ecology. However, a thorough review of contributions on the economics of pollination reveals several misconceptions behind the appealing fable of pollination externalities. The most striking rebuttal of Meade’s argument comes from the study of pollination markets, where beekeepers and crop growers engage in voluntary transactions called pollination contracts. A small economics literature formalizes the issue of incentives solved by these transactions and provides a detailed empirical analysis of many complex aspects, such as the establishment of standards for the monitoring of bee densities or the impact of seasonality of blooms and bee population dynamics on pollination prices. Outside pollination markets, economists have made rather sparse and partial contributions to several other important issues related to pollination in agriculture, such as valuation of pollination services, conservation of wild pollinators, and regulation of pesticides that impact pollinators. On these topics, studies have largely been published in non-economics journals and economists stand to make valuable contributions by applying and popularizing the concepts of incentive design, information costs, and other key insights of environmental economics in the study of pollination.


A New Economics to Achieve Sustainable Development Goals  

Marcello Hernández-Blanco and Robert Costanza

“The Anthropocene” has been proposed as the new geological epoch in which we now live. We have left behind the Holocene, an epoch of stable climate conditions that permitted the development of human civilization. To address the challenges of this new epoch, humanity needs to take an active role as stewards of the integrated Earth System, collaborating across scales and levels with a shared vision and values toward maintaining the planet within a safe and just operating space. In September 2015, the United Nations adopted the 2030 Agenda for Sustainable Development, which has at its core 17 Sustainable Development Goals (SDGs). These goals built on and superseded the Millennium Development Goals (MDGs). Unlike the MDGs, they apply to all countries and represent universal goals and targets that articulate the need and opportunity for the global community to build a sustainable and desirable future in an increasingly interconnected world. The global health crisis caused by COVID-19 has been a strong hit to a vulnerable development system, exacerbating many of the challenges that humanity faces in the Anthropocene. The pandemic has touched all segments of the global populations and all sectors of the economy, with the world’s poorest and most vulnerable people the most affected. Understanding the interdependence between SDGs is a key area of research and policy, which will require novel approaches to assess and implement systemic global strategies to achieve the 2030 agenda. Global society requires a new vision of the economy, one in which the economy is recognized to be a subsystem of the broader Earth System (a single complex system with reasonably well-defined states and transitions between them), instead of viewing nature as just another source of resources and sink for wastes. This approach will require acknowledging the value of nature, which, although it has been widely recognized in the scientific literature, has been often ignored by decision-makers. Therefore, there is a need to replace the static, linear model of gross domestic product (GDP) with more dynamic, integrated, natural, and human system models that incorporate the dynamics of stocks, flows, trade-offs, and synergies among the full range of variables that affect the SDGs and human and ecosystem well-being. The SDGs will only be achieved if humanity chooses a development path focused on thriving in a broad and integrated way, rather than growing material consumption at all costs. Achieving the SDGs is a future where society reconnects with the rest of nature and develops within its planetary boundaries. The new economics and the visions and strategies are aimed at achieving these shared global goals.


Adding Biodiversity to Agricultural Landscapes Through Ecology and Biotechnology  

David Still

Agriculture is practiced on 38% of the landmass on Earth, and having replaced natural ecosystems, it is the largest terrestrial biome on Earth. Agricultural biomes are typically focused on annual crops that are produced as a succession of genetically uniform monocultures. Compared to the ecosystems they replaced, agroecosystems provide fewer ecosystem functions and contain much less biodiversity. The large-scale conversion from natural lands to agriculture occurred centuries ago in the Old World (Africa, China, Europe, and India), but in many areas during the latter 20th and early 21st centuries, especially tropical areas with rich biodiversity, agriculture is an emerging industry. Here, displacement of natural ecosystems is also a late 20th-century occurrence, and much of it is ongoing. Regardless of where or when agriculture was established, biodiversity declined and ecosystem services were eroded. Agricultural practices are the second largest contributor to biodiversity loss, due to the loss of habitat, competition for resources, and pesticide use. Most (~96%) of the land used to produce crops is farmed using conventional methods, while smaller percentages are under organic production (~2%) or are producing biotech crops (~4%). Regardless of how agriculture is practiced, it exacts a toll on biodiversity and ecosystem services. While organic agriculture embraces many ecological principals in producing food, it fails to recognize the value of biotechnology as a tool to reduce the environmental impact of agriculture. Herbicide- and/or insect-resistant crops are the most widely planted biotech crops worldwide. Biotech crops in general, but especially insect-resistant crops, reduce pesticide use and increase biodiversity. The widespread adoption of glyphosate-resistant crops increased the use of this herbicide, and resistance evolved in weeds. On the other hand, glyphosate has less environmental impacts than other herbicides. Because of the limited scale of biotech production, it will not have large impacts on mitigating the effects of agriculture on biodiversity and ecosystem services. To have any hope of reducing the environmental impact of agriculture, agro-ecology principals and biotechnology will need to be incorporated. Monetizing biodiversity and ecosystem services through incorporation into commodity prices will incentivize producers to be part of the biodiversity solution. A multi-level biodiversity certification is proposed that is a composite score of the biodiversity and ecosystem services of an individual farm and the growing region were the food is produced. Such a system would add value to the products from farms and ranches proportionate to the level by which their farm and region provides biodiversity and ecosystem services as the natural ecosystem it replaced.


Valuing the Benefits of Green Stormwater Infrastructure  

Amy W. Ando and Noelwah R. Netusil

Green stormwater infrastructure (GSI), a decentralized approach for managing stormwater that uses natural systems or engineered systems mimicking the natural environment, is being adopted by cities around the world to manage stormwater runoff. The primary benefits of such systems include reduced flooding and improved water quality. GSI projects, such as green roofs, urban tree planting, rain gardens and bioswales, rain barrels, and green streets may also generate cobenefits such as aesthetic improvement, reduced net CO2 emissions, reduced air pollution, and habitat improvement. GSI adoption has been fueled by the promise of environmental benefits along with evidence that GSI is a cost-effective stormwater management strategy, and methods have been developed by economists to quantify those benefits to support GSI planning and policy efforts. A body of multidisciplinary research has quantified significant net benefits from GSI, with particularly robust evidence regarding green roofs, urban trees, and green streets. While many GSI projects generate positive benefits through ecosystem service provision, those benefits can vary with details of the location and the type and scale of GSI installation. Previous work reveals several pitfalls in estimating the benefits of GSI that scientists should avoid, such as double counting values, counting transfer payments as benefits, and using values for benefits like avoided carbon emissions that are biased. Important gaps remain in current knowledge regarding the benefits of GSI, including benefit estimates for some types of GSI elements and outcomes, understanding how GSI benefits last over time, and the distribution of GSI benefits among different groups in urban areas.


The Economics of Tropical Rainforest Preservation  

Carlos Eduardo Frickmann Young

Tropical forests are among the most biodiverse areas on Earth. They contribute to ecosystem functions, including regulating water flow and maintaining one of the most important carbon sinks on the planet, and provide resources for important economic activities, such as timber and nontimber products and fish and other food. Rainforests are not empty of human population and are sites of ethnically and culturally diverse cultures that are responsible for many human languages and dialects. They also provide resources for important economic activities, such as timber and nontimber products. However, tropical deforestation caused by the expansion of agricultural activities and unsustainable logging continues at very high levels. The causes of forest loss vary by region. Livestock is the main driver in the Amazon, but commercial plantations (soybeans, sugar cane, and other tradable crops) also have an impact on deforestation, in many cases associated with violent conflicts over land tenure. In Southeast Asia, logging motivated by the tropical timber trade plays an important role, although palm oil plantations are an increasing cause of deforestation. In Africa, large-scale agricultural and industrial activities are less important, and the most critical factor is the expansion of subsistence and small-scale agriculture. However, trade-oriented activities, such as cocoa and coffee plantations in West Africa and logging in Central Africa, are becoming increasingly important. Public policies have a strong influence on these changes in land use, from traditional community-based livelihood practices to for-profit livestock, cultivation, and timber extraction. Investments in infrastructure, tax and credit incentives, and institutional structures to stimulate migration and deforestation represent economic incentives that lead to deforestation. Poor governance and a lack of resources and political will to protect the traditional rights of the population and environmental resources are another cause of the continuous reduction of tropical forests. Consequently, deforestation prevents the expansion of economic activities that could be established without threats to the remnants of native forest. There are also negative social consequences for the local population, which suffers from the degradation of the natural resources on which their production is based, and is hampered by air pollution caused by forest fires. In some situations, a vicious cycle is created between poverty and deforestation, since the expansion of the agricultural frontier reduces the forest areas where traditional communities once operated, but without generating job opportunities. New approaches are required to reverse this paradigm and to lay the foundation for a sustainable economy based on the provision of ecosystem services provided by tropical forests. These include (a) better governance and public management capacity, (b) incentives for economic activities compatible with the preservation of the tropical forest, and (c) large-scale adoption of economic instruments to support biodiversity and ecosystem services. Public policies are necessary to correct market failures and incorporate the values of ecosystem services in the land use decision process. In addition to penalties for predatory actions, incentives are needed for activities that support forest preservation, so the forest is worth retaining rather than clearing. Improving governance capacity, combining advanced science and technology with traditional knowledge, and improving the management of existing activities can also help to ensure sustainable development in tropical forest regions.


Valuation of Wetlands Preservation  

Alexandra Dehnhardt, Kati Häfner, Anna-Marie Blankenbach, and Jürgen Meyerhoff

All types of wetlands around the world are heavily threatened. According to the Ramsar Convention on Wetlands, they comprise “areas of marsh, fen, peatland or water, whether natural or artificial, permanent or temporary, with water that is static or flowing, fresh, brackish, or salt.” While they are estimated still to cover 1,280 million hectares worldwide, large shares of wetlands were destroyed during the 20th century, mainly as a result of land use changes. According to the Millennium Ecosystem Assessment (MEA), this applies above all to North America, Europe, Australia, and New Zealand, but wetlands were also heavily degraded in other parts of the world. Moreover, degradation is expected to accelerate in the future due to global environmental change. These developments are alarming because wetlands deliver a broad range of ecosystem services to societies, contributing significantly to human well-being. Among those services are water supply and purification, flood regulation, climate regulation, and opportunities for recreation, to name only a few. The benefits humans derive from those services, however, often are not reflected in markets as they are public goods in nature. Thus, arguing in favor of the preservation of wetlands requires, inter alia, to make the non-marketed economic benefits more visible and comparable to those from alternative—generally private—uses of converted wetlands, which are often much smaller. The significance of the non-market value of wetland services has been demonstrated in the literature: the benefits derived from wetlands have been one of the most frequently investigated topics in environmental economics and are integrated in meta-analyses devoted to synthesizing the present knowledge about the value of wetlands. The meta-analyses that cover both different types of wetlands in different landscapes as well as different geographical regions are supplemented by recent primary studies on topics of increasing importance such as floodplains and peatlands, as they bear, for example, a large flood regulation and climate change mitigation potential, respectively. The results underpin that the conversion of wetlands is accompanied by significant losses in benefits. Moreover, wetland preservation is economically beneficial given the large number of ecosystem services provided by wetland ecosystems. Thus, decision-making that might affect the status and amount of wetlands directly or indirectly should consider the full range of benefits of wetland ecosystems.


Valuation of Beach Quality  

Ashley Barfield and Craig E. Landry

The result of interactive dynamics of the ocean, landforms, and weather patterns, sandy beaches and dunes are a natural feature along many coastlines around the world. Their contributions to overall social welfare are multifaceted and complex. Providing water access, recreation and tourism potential, scenic beauty, and leisure amenities, sandy coastlines have witnessed extensive commercial and residential development. Intact beach–dune systems provide coastal development projects with protection from storms, erosion, flooding, and (to some extent) sea-level rise. While yielding value through capital investment, market expansion, and the enhancement of access to natural amenities, increases in buildings and infrastructure can upset the delicate dynamic equilibrium in coastal systems. This, in turn, puts beaches, dunes, wetlands, wildlife habitats, and other ecological resources at risk. Concerns about these impacts have provided the impetus for several environmental management initiatives. Critical to these initiatives is information about the multidimensional economic and social values of coastal amenities, especially beaches and dunes. The economic valuation of beach quality and coastal ecosystem services has traditionally focused on the implementation of non-market valuation techniques, including revealed (e.g., hedonic prices and travel costs) and stated preference (e.g., contingent valuation and choice experiment) approaches, in conjunction with survey/experimental design methods. Analysis of beach quality has become a vibrant topic, especially in response to concerns about the need for climate change adaptation; the impacts of sea-level rise; worsening and more frequent storm events; and changes in ocean temperature, salinity, and alkalinity. Each of these factors can ultimately impact beaches and coastal economies. As a result, the literature has broadened to include a number of interdisciplinary studies that feature the contributions of environmental economics, marine science, applied geology, natural resource management, risk and insurance, and urban planning disciplines, among others. These collaborations have advanced the science of coastal economics and management, but many significant challenges remain. Questions about the optimal order and timing of adaptation procedures, how to balance the provision of synergistic or conflicting goods and services, and how to design dynamic models that incorporate real-world management scenarios across different jurisdictions all require further investigation.