Progress and potential pitfalls of economic valuation of natural capital: A path forward
There is growing demand for valuation of environmental services, driven by end-user requests for information on tradeoffs and consequences of alternative land management and conservation decisions. How do we balance this demand for information with lingering questions about uncertainty, representation, and data gaps that can inhibit our ability to supply reasonable value estimates?
In this talk, we will draw on case studies in agricultural watershed management, global forest landscape restoration, and state and federal agency planning to highlight progress and remaining challenges associated with economic valuation of ecosystem services. Areas of progress include better integration of biophysical and economic models, advancements in non-monetary valuation techniques, and new data sources that can inform revealed preference approaches. Remaining challenges include incorporating and communicating uncertainty, combining different types of values in a common framework, and proper interpretation of valuation data. Debates over new vs. old conservation have raised important questions about unintended consequences of economic valuation of nature and the most appropriate strategies for conservation organizations and researchers. However, decisions must be made and demand for valuation information is only growing. Drawing from diverse experiences in multiple decision contexts, we propose a path forward for economic valuation that integrates lessons learned, leverages and incentivizes new research to address key gaps, and considers appropriate use and interpretation of value.