The economic value of coral reefs: climate change impacts and spatial targeting of restoration measures

Carlo Fezzi (), Mauro Derek J. Ford and Kirsten L.L. Oleson

No 2022/5, DEM Working Papers from Department of Economics and Management

Abstract: We develop a travel-cost random utility model to estimate the value of recreational ecosystem services provided by more than 170 outdoor sites located on the island of Maui (Hawaii, USA). Particular emphasis is placed on the role of coastal ecosystems by combining recent fine-scale data on coral cover and fish biomass with information on almost 3000 recreation trips taken by Maui’s residents. Our approach is grounded in economic theory and provides estimates that are directly applicable to inform a wide array of spatial planning questions for coastal management. We apply our model to calculate the economic losses caused by the 2014-2015 coral bleaching event, which are in the order of $25M per year. We also identify the areas where coral reef restoration would maximize welfare gains. Impacts can vary up to a factor of 1000 across locations, demonstrating the need to carefully consider such heterogeneity in spatial prioritization. Our simulations also show how access fees can raise funds for financing conservation measures aimed at bolstering coral reefs resilience to climate change.

Keywords: coral reefs; ecosystem services; climate change; recreation; coastal management (search for similar items in EconPapers)
Date: 2022
New Economics Papers: this item is included in nep-agr, nep-env and nep-upt
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