Assessing the Economic Value of Ecosystem Conservation

Valuation studies have considerably increased our knowledge of the value of ecosystems. Their usefulness has often been undermined, however, by a failure to properly frame them so as to address the specific question of interest. Unfortunately, environmental advocates in the media, government, business, and civil society have often seized on impressive but sometimes unsound valuation results and used them indiscriminately, and often inappropriately.
Valuation is not a single activity, and the seemingly simple question ‘how valuable is an ecosystem? can be interpreted in many different ways. It could be interpreted as asking about the value of the current flow of benefits provided by that ecosystem, for example, or about the value of future flows of benefits. It could also be asking about the value of conserving that ecosystem rather than converting it to some other use. These interpretations of the question are often treated as being synonymous, but they are in fact very different questions, and the answer to one will not be correct as an answer to the other.