Economics of the ecosystem service approach to management: Forest experiences Jette Bredahl Jacobsen (IFRO) & Center for Macroecology, Evolution and Climate (CMEC) Faculty of Science University of Copenhagen Dias 1
The ecosystem services a growing taxonomy Dias 2
The root of the interest in economics of Biodiversity and Ecosystem Services Dias 3
The Total Economic Value Total Economic Value Total Use Values Total Non-Use Values Current Use Values Potential Use Values Primary Use Values Indirect Use Values Option Values Bequest and altruist values Existence Values Dias 4
Marginal Values Marginal Values not Total Values matter for decision makers A G C Dias 5 Marginal values Quantity of ecosystem service
Marginal Values Marginal Values not Total Values matter for decision makers A G Which marginal values are we looking at? Marginal values Dias 6 Quantity of ecosystem service
Valuing ecosystem services from forests Dias 7
Biodiversity an ecosystem service Fundament for other services. Around 30000 species in Denmark Do we need them all? Or can we do without some of them? Dias 8
Biodiversity as the basis of everything or a supportting service or a cultural service? We know very little of the functional relationships: Reduced biodiversity => lower production? Not always Quantities: no Thresholds: no Can we live without some, and if so, how many? Will we? Dias 9
Species conservation Studies have shown willingness-to-pay for species conservation in the range of 1000 DKK for securing 50 endangered species survival 1 1500 DKK for securing 100 endangered species survival 1 Or for increased populations of common species: 1000 DKK for 500 species 2 1 Campbell, Vedel, Thorsen, Jacobsen, 2014: Heterogeneity in the demand for recreational access distributional aspects. Journal of Environmental Management and Planning 2. Bakhtiari, F., et al., work in progress Dias 10
Does it matter what species we preserve? < Only little (e.g. Jacobsen et al., 2008, 2012) Dias 11
It is due to the possibility of seing the species that we want to preserve it? Endangered species on the Danish heathland (Jacobsen et al., 2008) Dias 12
Biodiversity matters to people Regardless of whether we see it of whether we know it Of whether it it has any functional value Dias 13
Recreation and ecosystem service The Danish forests receive 70 mio visits every year Danish nature: 110 mio. The median distance is 3 km from people s home Also large WTP. But we do not want to meet too many peers Dias 14
Provision of ecosystem services how much does it cost? 3/4th of the Danish forests are privately owned Private costs public good Some regulatory instruments are needed Dias 15
Who should pay? The public s (PU) and the forest owners (FO) viewpoint on who should bear the cost 100 90 80 70 60 50 40 30 PU: Biodiv protect FO: Biodiv protect 20 10 0 Users should pay Forest owner should pay Society should pay Dias 16
regulation and marketbased instruments 90 The public (PU) and the forest owners (FO) view on who should pay 80 70 60 50 40 30 20 10 PU: Recreation FO: Recreation PU: Biodiv protect FO: Biodiv protect PU: Water protect FO: Water protect 0 Users should pay Forest owner should pay Society should pay Workshop on fisheries, aquaculture and the marine Dias 17 environment, June 15, 2015
Percentage of respondents regulation and marketbased instruments - Across five countries, we find significant differences in public attitudes: 80,0 Who should carry costs of more recreational services? 70,0 60,0 50,0 40,0 30,0 20,0 10,0 Denmark Finland Italy Poland Spain 0,0 Users should pay Forest owner should pay Society should pay Workshop on fisheries, aquaculture and the marine Dias 18 environment, June 15, 2015
European project on forest externalities looked at forest owner preferences Dias 19
Participation in Danish subsidy schemes Sometimes difficult to get landowners to enter Compensation may not cover cost we don t know the exact cost for a land owner Require compensation for lost options And if we want to conserve biodiversity it makes little sense to allow for conversion back Dias 20
Compensation claim for leaving 5% of the forest untouched (Vedel et al 2015 in Ecol. Econ.) 3.6 DKK/ha/year for leaving 1% of the forest untouched 360 DKK/year for 1 ha untouched forest If forest owners already have untouched forests, they, on average, to not require extra compensation for it Dias 21
The price for setting aside 5% of my forest as untouched DKK/ha and year for the 5% A supply curve for untouched forest from Danish forest owners 2000 1500 1000 500 0 0 2000 4000 6000 8000 10000 12000 14000 16000 18000 20000-500 -1000-1500 Total number of hectares Dias 22
An economic approach UK NEA Mace and Bateman, 2011 Dias 23
Ecosystem approach Illustrates intertwingled relationship between natural conditions, management, wealth Focus on marginal values but more and more linked to natural capital Dias 24
Isn t it just old wine in new bottles? Looks at marginal values (timber production) but an eye on natural capital (standing timber) and include multifunctionality= several ecosystem services Construction wood Recreation Biodiversity Groundwater Biomass for energy Climate: CO 2 -storage Dias 25
Use info to target policies requires more than zoning Where is the benefit Site-specific costs Relation between different ecosystem services Spatial interrelationship between ecosystem services Ownership And in the future: dynamic effects Dias 26
Forest & seas Both are renewable resources With multiple ecosystem services With spatially explicit ecosystem services and relationships Trees do not move around Stock is visible We see biodiversity in the sea less We visit the sea less for recreation There is, in Denmark, specific property rights in forests Dias 27
Thank you for your attention Dias 28