Accounting for the increasing benefits from scarce ecosystems

Moritz Drupp, M. C. Hänsel, E. P. Fenichel, M. Freeman, C. Gollier, Ben Groom, Geoffrey Heal, P. H. Howard, A. Millner, F. C. Moore, Frikk Nesje, Martin Quaas, S. Smulders, T. Sterner, C. Traeger and Frank Venmans

LSE Research Online Documents on Economics from London School of Economics and Political Science, LSE Library

Abstract: Governments are catching up with economic theory and practice by increasingly integrating ecosystem service values into national planning processes, including benefitcost analyses of public policies. Such analyses require information not only about today’s benefits from ecosystem services but also on how benefits change over time. We address a key limitation of existing policy guidance, which assumes that benefits from ecosystem services remain unchanged. We provide a practical rule that is grounded in economic theory and evidence-based as a guideline for how benefits change over time: They rise as societies get richer and even more so when ecosystem services are declining. Our proposal will correct a substantial downward bias in currently used estimates of future ecosystem service values. This will help governments to reflect the importance of ecosystems more accurately in benefit-cost analyses and policy decisions they inform.

JEL-codes: Q50 (search for similar items in EconPapers)
Pages: 3 pages
Date: 2024-03-08
New Economics Papers: this item is included in nep-env
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (5)

Published in Science (New York, N.Y.), 8, March, 2024, 383(6687), pp. 1062 - 1064. ISSN: 0036-8075

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Working Paper: Accounting for the increasing benefits from scarce ecosystems (2024)
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