Lecture 14: Ecosystem services and Nature's Contributions to People

Gonzalez

Ecosystem services flow

The Dasgupta Review

• Outlines three kinds of capital: Human, Produced, and Natural

Inclusive wealth - equation

Inclusive wealth= K+H+N

• K= produced capital

• H= human capital

• N= natural capital

Natural capital

Stock of renewable and non-renewable natural assets that contribute to the flow of benefits (ecosystem services) to people

Four classes of ecosystem services 

• Provisioning

• Regulating

• Supporting 

• Cultural

Valuation approaches to ecosystem services

• Biophysical - qualifying functions (i.e. tons of carbon sequestered)

• Economic - monetary valuation, cost-benefit analysis

• Sociocultural - participatory, relational, or intrinsic value assessments

IPBES conceptual framework

Nature’s contributions to people - IPBES

3 categories of NCPs

• Material

• Non-material

• Regulating

The 18 classes of NCPs fall into one or more of these categories

Ecosystem Service Production Functions (ESPFs) - equation

ES=f(B*E*H)

• ES= quantity of ecosystem service

• B= biotic variable

• E= abiotic variables

• H= human inputs

Links natural capital to ecosystem service flows

Pollination service - equation

Y= Y₀ + B(beta)₁D^-l(lambda)

• Y= actual crop yield

• Y₀= baseline yield without wild pollinators

• D= distance from natural habitat

• beta, lamba = fitted parameters

Payment for Ecosystem Services (PES)

• “Magic bullet”

• Pay people who steward nature enough to do it well

• A voluntary transaction where a well-defined ecosystem service is bought by at least one buyer from at least one provider if and only if the provider secure the provision.

PES flowchart

PES economic equations

P_i= a(alpha)*Q_i

• P_i= payment to landholder i

• Q_i= quantified ecosystem delivered to buyer (i.e. tons of carbon sequestered)

• a(alpha)= price or value per unit service

Adopt conservation if P_i is greater than or equal to (R_i^alt - R_i^con)

• R_i^alt= revenue from alternative use (e.g. agriculture)

• R_i^con= revenue from conservation

Practical takeaways for PES

1. Target where the threat is high

2. Set payments to cover opportunity costs

3. Make benefits contingent on outcomes

4. Design for equity and legitimacy

5. Anticipate leakage

6. Leverage collective of hybrid models

Commodification of nature - a critique

1. Intrinsic, regional, cultural values lost

2. Nature protected only where it is profitable

3. Inequality is reproduced

4. Perverse incentives can arise