Economic valuation methods for ecosystem services

Research output: Chapter in Book / Report / Conference proceedingChapterAcademicpeer-review

Abstract

Various valuation methods exist and have been applied to estimate the values of different ecosystem services. The methods reflect the extent to which the services provided by ecosystems touch on the welfare of society either as direct determinants of individuals’ well-being (e.g. as consumer goods) or via production processes (e.g. as intermediate goods). The aim of this chapter is to provide an overview of available valuation methods, to discuss their advantages and disadvantages, and to provide guidance on when to use which method. In doing so we do not aim to be comprehensive; extensive details of the underlying theory and on the actual practice of applying the valuation methods are provided in general texts, including Braden and Kolstad (1991), Freeman (2003), Bateman et al. (2002), Mitchell and Carson (1989), Champ et al. (2003), Bockstael and McConnell (2007), and Kanninen (2007). A number of economic valuation methods have been developed to estimate the value of changes in ecosystem services. An important distinction is between market-based and non-market-based valuation methods. Market-based valuation means that existing market behavior and market transactions are used as the basis for the valuation exercise. Economic values are derived from actual market prices for ecosystem services, both when they are used as inputs in production processes (production values) and when they provide direct outputs (consumption values). By observing how much of an ecosystem service is bought and sold at different prices, it is possible to infer directly how people value that good. Examples of market-based methods are the use of direct market prices, net factor income and production function methods, and the calculation of replacement costs, defensive expenditures, and avoided damage costs.

Original languageEnglish
Title of host publicationEcosystem services: From concept to practice
EditorsJ.A. Bouma, P.J.H. Beukering, van
Place of PublicationCambridge, UK
PublisherCambridge University Press
Pages108-131
Number of pages24
ISBN (Electronic)9781107477612
ISBN (Print)9781107062887
DOIs
Publication statusPublished - 1 Jan 2015

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valuation
economic valuation
ecosystem service
ecosystem services
Ecosystem
Economics
economics
markets
market
market prices
methodology
direct marketing
method
Costs and Cost Analysis
production functions
touch (sensation)
Health Expenditures
expenditure
income
exercise

Cite this

Koetse, M. J., Brouwer, R., & Van Beukering, P. J. H. (2015). Economic valuation methods for ecosystem services. In J. A. Bouma, & P. J. H. Beukering, van (Eds.), Ecosystem services: From concept to practice (pp. 108-131). Cambridge, UK: Cambridge University Press. https://doi.org/10.1017/CBO9781107477612.009
Koetse, Mark J. ; Brouwer, Roy ; Van Beukering, Pieter J H. / Economic valuation methods for ecosystem services. Ecosystem services: From concept to practice. editor / J.A. Bouma ; P.J.H. Beukering, van. Cambridge, UK : Cambridge University Press, 2015. pp. 108-131
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Koetse, MJ, Brouwer, R & Van Beukering, PJH 2015, Economic valuation methods for ecosystem services. in JA Bouma & PJH Beukering, van (eds), Ecosystem services: From concept to practice. Cambridge University Press, Cambridge, UK, pp. 108-131. https://doi.org/10.1017/CBO9781107477612.009

Economic valuation methods for ecosystem services. / Koetse, Mark J.; Brouwer, Roy; Van Beukering, Pieter J H.

Ecosystem services: From concept to practice. ed. / J.A. Bouma; P.J.H. Beukering, van. Cambridge, UK : Cambridge University Press, 2015. p. 108-131.

Research output: Chapter in Book / Report / Conference proceedingChapterAcademicpeer-review

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Koetse MJ, Brouwer R, Van Beukering PJH. Economic valuation methods for ecosystem services. In Bouma JA, Beukering, van PJH, editors, Ecosystem services: From concept to practice. Cambridge, UK: Cambridge University Press. 2015. p. 108-131 https://doi.org/10.1017/CBO9781107477612.009