• Selected
• Entire List

Abstract:
This paper introduces and surveys ecological-economic analysis and valuation of biodiversity. Furthermore, the notion and application of economic, monetary valuation of biodiversity is critically evaluated. A classification of biodiversity values is offered, based on a system of logical relationships among biodiversity, ecosystems, species and human welfare. Suggestions are made about which economic valuation methods can address which type of biodiversity value. The resulting framework is the starting point for a survey and evaluation of empirical studies at each of the four levels of diversity. The resulting monetary value estimates seem to give unequivocal support to the belief that biodiversity has a significant, positive social value. The contingent valuation method is by far the most used method. An important reason is that the other valuation methods are unable to identify and measure passive or nonuse values of biodiversity. Nevertheless, most studies lack a uniform, integrated perspective on biodiversity. Therefore, available economic valuation estimates should generally be regarded as providing a partial perspective on, and at best lower bounds, to the unknown value of biodiversity changes.

Biodiversity, biotic richness, use economic value, nonuse economic value, monetary values, contingent valuation, ecosystem health, integrated modeling

Abstract:
The paper focuses on the ongoing debate on non-market valuation, including the valuation environmental goods, and the opportunity to use contingent valuation for policy guidance. In fact, contingent valuation critics argue that reported willingness to pay answers do not reflect real economic preferences and, for this reason, should not be used in cost-benefit analysis The attempt to contravene such critique finds many supporters. This paper starts from the latter stream of research and adds two original contributions. First, it sheds light on the individual warm glow motivational profile, exploring the empirical relationship between individual's socio-economic characteristics and warm glow. Second, it discusses some implications of the presence of warm glow for public policy.

Economic value, Contingent valuation, Willingness to pay, Latent factor, Consumer motivations, Warm glow, Ego driven warm glow, Social oriented warm glow, Public policy design

Abstract:
This paper provides an economic evaluation of certification and ecolabeling as an important policy instrument for creating markets for biodiversity. In the paper we conclude that the success of a policy instrument for creating markets for biodiversity depends on the nature crucial factors, including the ability of the policy instrument to deal with (a) the public good nature of most of the nonmarket biodiversity benefits; (b) the asymmetric informational characteristics related to the biodiversity (and environmental friendly) market supply and demand mechanisms; (c) the impact of certification practices in the producer's costs, and (d) the cross price elasticity between regular and market certified products. Indeed, in some cases certification and ecolabeling policy instruments alone are not sufficient to guarantee a successful creation of markets for biodiversity. Finally, the certification schemes need to be sufficiently flexible to allow mutual recognition among the countries involved, as well as to meet the demand of weak sensitive markets. By mutual understanding, and learning with the past experiences, certification and ecolabeling will positively contribute to the creation of markets for biodiversity and thus expected to assist to the development of an effective and broadly accepted sustainable management of such a scarce natural resource.

Biodiversity, regulation, certification, ecolabeling, information, adverse selection, consumer awareness, command-and-control

Abstract:
For the past two-decades, China has experienced strong, continuous economic growth. At the same time, the number of motor vehicles in China has rapidly increased. As a direct result of such a phenomenon, China has been registering significant increases in air pollution. In spite of recent advances in air pollution control, it remains a serious problem for China's major cities, and constitutes an important issue in the agenda of its policy makers. The object of this paper is to explore the use of cost-benefit analysis (CBA) to evaluate and rank alternative policy scenarios regarding the control of air pollution emitted by motor vehicles. The empirical analysis carried out relates specifically to the Chinese context, over a twenty year period, from 2001 to 2020, and focuses on emission changes of the following three principal pollutants: CO, HC and NOx.

Vehicle, pollution, CO, HC, NOx, scenario, standard, cost, benefit, China

Abstract:
This paper reports the results from a contingent valuation study designed to investigate the influence of warm glow in willingness-to-pay responses. Interindividual differences in warm glow motivation are measured through a factor analysis, performed on a list of attitudinal items. The reported willingness to pay measures fail to pass the scope test. Both socioeconomic variables and motivational factor scores are significant in the explanation of the individual WTP measures. We compute dry WTP measures by taking out the effect of the warm glow motivation. These dry measures satisfy both the scope test and Hausman's adding-up property and could therefore be interpreted as reflecting true economic preferences.

Contingent valuation, recreation, wildlife, willingness to pay, warm glow

Abstract:
The rationale for conservation and creation of wetlands stems from the recognition of both their ecological and economic values. This paper examines the welfare impacts of goods and services provided by wetlands. We collected 385 estimates of the economic value of 181 natural and man-made wetlands from 167 studies worldwide. The resulting database is less biased towards North America than previous reviews of the literature. The relative importance of characteristics of the valuation study, of the wetland site, and of the socio-economic and geographical context is estimated by means of a meta-regression analysis of wetland values. Provision of amenities, flood control and storm buffering, and water quality improvement are the most highly valued wetland services. The relevance of the socio-economic and geographical context clearly emerges from the analysis and, in particular, the proximity to other wetland sites is negatively correlated with valuations. An analysis of the effect of environmental stress on wetland value shows that the latter increases with stress from human development activities and uses. In addition to the basic meta-regression model, the influence of authorship effects and of the geographic regions is examined by means of a multi-level approach. A second extended meta-regression model including cross-effects shows that the valuations of specific services vary according to the type of wetland producing them.

Constructed Ecosystems, Economic Valuation, Man-Made Wetlands, Meta-Regression, Wetland Values

Abstract:
This paper focuses on the analyses and evaluation of resilience anchored in an economic perspective. Resilience, as well as most of the benefits provided by ecosystems, is not priced on current markets. However, this does not mean that resilience is of no value for humans. On the contrary, the interest of using an economic perspective, and the respective scientific methodology, will be put forward in terms of resilience relevance for ecosystems' life and functioning, and its impact on human welfare. The economic perspective is anchored in an anthropocentric analysis meaning that resilience is evaluated in terms of provision of natural capital benefits. These, in turn, are interpreted as an insurance against the risk of ecosystem malfunctioning and the consequent interruption of the provision of goods and services to humans. For this analysis, we make use of a conceptual framework so as to identify and describe the different value components of resilience. Finally, we present an illustration that tackles the economic analysis and discussion of resilience benefits in the context of the Venice Lagoon.

Ecosystems' resilience, Ecosystems' thresholds, Natural insurance capital, Economic perspective, Economic value

Abstract:
This paper explores the use of a micro-economic model to analyse the provisions and parties of bioprospecting contracts. It focuses on the pharmaceutical industry as the representative biodiversity buyer, presenting an original theoretical framework that explains the main contract characteristics or stylised facts. Against this background, it considers the main contractors involved in these private contracts, i.e. biodiversity sellers and biodiversity buyers, analysing both the magnitude and distribution of the respective payoffs. Particular attention is devoted to the different, mixed impacts of bioprospecting contracts and patenting on social welfare. The positive welfare impacts delivered by bioprospecting contracts are associated with the potential discovery of a new drug product, i.e. productivity gains, non-monetary benefit-sharing or transfers and royalty revenues. The negative welfare impact results from the legal creation of a monopoly and the related well-known effect on the consumer surplus. Finally, the potential redistribution effects are limited, and a potential enforcement of this objective may jeopardise the desirability of the contracts since this action would lead to a significant increase in the transaction costs.

Bioprospecting Contract, Genetic Resource, Biodiversity Buyer, Biodiversity Seller, Patenting, Welfare Analysis, Benefit Sharing

Abstract:
This paper offers an economic assessment of the loss of non-use values resulting from different oil spill scenarios along the Belgian Coast. Estimation results show that if no oil spill prevention policy action is undertaken, a significant welfare loss may result. As a matter of fact, contingent valuation estimation results show such a welfare loss ranges from 120 million Euro to 606 million Euro, depending on the size and the frequency of the oil spill under consideration. Therefore, any investment program targeted at the prevention of oil spills, and its damage on the marine environment, can be clearly defended from a cost-benefit perspective as long as its cost is no higher than 120 million Euro.

Oil Spill, Prevention Scenario, Contingent Valuation, Cost Benefit Analysis

Abstract:
This article focuses on the economic valuation of alternative clam management practices in the Venice Lagoon. The proposed valuation method is characterized by the design of a survey questionnaire next to the fishermen population. In each questionnaire two fishing alternatives are described. The respondent is asked to choose one of them. This valuation method, referred in the article as conjoint valuation, gives sufficient flexibility to set, alter, and combine different management practices. Furthermore, this approach presents an important advantage to the well-known contingent valuation method since it makes the monetary valuation of each management attribute possible. Estimation results of the random utility model show that fishermen's willingness to pay for a larger clam fishing area is approximately 568 Euro per year. In addition, an individual fisherman would be willing to pay 1,005 Euro for a change from today's fishing situation practice towards a fishing practice exclusively based on vibrant rake system. If we take into account the interaction between fishing management attributes and fishermen characteristics, we can see that the valuation of each management practice differs substantially across the two populations. We can observe that the population of fishermen that operate in the cooperative regime presents not only a higher monetary valuation for an increase in the dimension of the fishing concession, which is now valued at 811 Euro, but also a stronger willingness to pay for a change from today's fishing situation towards a fishing practice exclusively based on vibrant rake system, which is now estimated at 2,456 Euro. Finally, the adoption of a clam fish management practice in Venice Lagoon that is exclusively based on the use of manual rakes, which is associated to the lowest damage to the Lagoon ecosystem, will represent a welfare loss of 5,904 Euro per fisherman per year. Combining this value with the total number of fishermen currently operating in the Lagoon of Venice, the welfare loss associated with the adoption of such clam management policy that is exclusively based on the use of manual rakes amounts to 11.8 Euro million per year. This figure can be regarded as an upper bound to the cost of implementation of a clam fishing system anchored in the use of manual, ecosystem friendly rakes.

Exotic marine species, Fishing rakes, Manila clam, Fishing effort, Open access, Welfare damages, Policy guidance, Permit price

Abstract:
By using ad hoc value transfer protocols, this paper offers a methodological contribution and provides accurate per hectare estimates of the economic value of some selected ecosystem services for all forest biomes in the world, identified following the Millennium Ecosystem Assessment taxonomy MEA. The research also estimates potential total economic losses from policy inaction in year 2050. Final results show that total losses are significant. The total figure is €78 billion, the greatest losses coming from North America and Mexico, followed by Africa, Russia and some Asiatic countries. Most of this loss is attributable to provisioning services and carbon sequestration, while only a minor part is due to loss of cultural services. In terms of biomes the greatest losses are from boreal and warm mixed forests, followed by tropical forests. These results may be surprising to some who argue that it is the loss of tropical forests, particularly the Amazon, that is the most significant. A detailed analysis, shows, however, that this is not the case. The best estimates point to greater losses in areas where use and non-use values are highest, which includes North America.

Forest, Ecosystem Services, Biodiversity, Valuation, Value Transfer

Abstract:
This paper provides an assessment of the economic value of the oceanographic services provided by the Mediterranean operational forecasting system, MFSTEP. The main purpose of this exploratory study is to carry out a cost-benefit analysis for different development scenarios, by comparing the costs associated with the project implementation with the private benefits that arise from delivering its products on the market. As far as the costs are concerned, a total cost assessment has been performed by identifying, classifying and estimating the wide range of inputs that have been allocated both to the project development and maintenance. Against this context, a cost questionnaire has been designed and administered to all MFSTEP partners. In addition, the study focuses on an end-users analysis in order to examine end-users' attitudes and interests for the forecasting products, their needs and satisfaction. As before, we make the use of a survey. Finally, this questionnaire is characterized by exploring the use of the contingent valuation approach so as to address and estimate the private benefits derived from the provision of the MFSTEP products. Estimation results show that the mean willingness to pay for accessing the forecasting products amounts to 65 euro per download. Cost-benefit analysis reveals that, from a market perspective relying on the profit maximisation, a total of 163 downloads per day are required for total maintenance costs recovery, whereas 90 downloads per day are required to recover personnel maintenance costs. Finally, 33 downloads per day are required so as to recover durable equipment maintenance costs.

Cost-Benefit Analysis, Contingent Valuation, Survey Design, Willingness to Pay, Cost Assessment, Observing and Modelling Oceanographic System

Abstract:
We examine the impact of providing a "no-choice" option in an attribute based valuation experiment. The aim of the experiment was to assess monetary values of cockle fishery management practices in the Dutch Wadden Sea for different stakeholder groups, namely Dutch citizens, local residents, and tourists. The current policy debate about the management of the Wadden Sea stresses the fact that individual preferences with respect to cockle-fishery differ. The aim of this paper is to analyze the individual preferences in an objective way. Special attention is given to the influence of including a "no-choice option", which is analyzed using a nested logit model. We test whether the full set of policy options can be considered as close substitutes. The estimation results show that the influence of including the no choice option differs among the stakeholders considered.

Stakeholder valuation, Stated choice method, Multinomial logit model, Binary logit model

Abstract:
The paper focuses on the economic assessment of damages caused by high water in the city of Venice. In particular, we focus our attention on a valuation exercise that addresses the estimation of monetary, short period, on-site damages due to high water events on the different business activities located in Venice. On-site damages include both mitigation costs, which refer to all types of financial expenditure undergone to avert physical and material damages caused by flooding, and remediation costs, i.e. costs to be sustained for maintenance and substitution of affected building elements. Hence, the present study can be considered as a pioneering attempt to analytically quantify, from an economic point of view, on-site damages from high water. An integrated dose-response modelling and an expert-based valuation approach have been selected as the most suitable economic valuation methodology to shed light on the on-site damages. The main focus of the work is to assess dose-response relationships, which are able to describe the physical effects of high water on the different on-site damage categories, including inner and front doors maintenance, cleaning of pavements and maintenance of the walls. Bearing in mind such an economic valuation framework, we proceed with the estimation of on-site damages not only for the present high water situation (business as usual) but also extend the valuation exercise to three additional high water scenarios: (1) a climate change scenario; (2) a high water protection scenario; and, (3) a combined climate change and protection scenario. Estimation results show that the welfare loss due to on-site, short-term damages supported by the business activities ranges from 3.41 to 4.73 million Euro per year, respectively for the business as usual and climate change scenarios. Finally, we can conclude that the introduction of a public policy protection mechanism that defends the city of Venice from any flooding above 110 cm above the Punta della Salute Tidal Datum, such as the MOSE, will reduce the on-site damages supported by the business activities up to 2.87 million Euro per year.

High water damages, Venice, Economic valuation

Abstract:
The Millennium Ecosystem Assessment is built on a conceptual framework that links biodiversity to the services ecosystems provide to society. Based on this framework, we first compile market and non-market forest valuation studies and, secondly, explore the potential of an econometric modeling exercise by conducting a world wide meta-analysis. This exercise aims to highlight the mapping of biodiversity indicators and assesses their respective role on the valuation exercise. Our results show that biodiversity loss is having an effect on forest ecosystem values. In addition, these effects reveal to be dependent on the type of services and global geo-climatic regions.

Millennium Ecosystems Approach, Biodiversity Loss, Meta-Analysis, Market Valuation, Non-Market Valuation, Forests

Abstract:
This paper offers an economic value assessment of a nature protection programme in the Veluwe. This programme involves two defragmentation scenarios: the first scenario connects the central part of the Veluwe with the IJssel river forelands in a north-eastern direction, while the second scenario is focused on defragmentation in a south-western direction, where the Rhine river forelands are located. The valuation is based on a questionnaire that was administered during face-to-face interviews in the Veluwe area and through the Internet. We employ a contingent valuation approach to assess the respondents' willingness to pay for the realisation of the defragmentation scenarios. It appears that the mean willingness to pay for the two defragmentation scenarios are Euro 59.7 and Euro 162.2 per respondent. These two willingness-to-pay estimates, which refer to a lump sum payment (or 'once-and-for-all payment'), are based on a lognormal and Weibull distribution respectively. In addition to the willingness to pay, we also estimate recreation benefits of the Veluwe. To that end, we use the travel cost technique, the purpose of which is to arrive at an estimate of the site's consumer surplus. According to this technique, the yearly recreational benefits are estimated between Euro 0.06 and Euro 0.45 per visitor. Whereas the former estimate is based on the fuel costs only, the latter covers also insurance and maintenance costs, and capital depreciation. Finally, we performed an aggregation of individual WTP estimates over Dutch households. With the resulting aggregate estimates we are able to compare the total costs and benefits of the two scenarios for habitat fragmentation in the Veluwe. The result of such a simple comparison turns out to critically depend on whether the mean or median estimate is used for aggregation. If aggregation of individual WTP estimates is based on mean values, then the benefits far exceed the estimated costs of defragmentation. In other words, based on an integrated economic-ecological analysis it makes sense to execute the defragmentation measures described in the scenarios. However, aggregate estimates obtained by using median values result in higher costs than aggregate estimates that are based on mean values. Even stronger, median-based estimates show that the costs of implementing scenario 2 are higher than the total benefits of this scenario.

Economic value, Nature protection, Defragmentation policy, Veluwe

Abstract:
The paper examines the use of choice experiments (CE) to assess the economic value of alternative rail noise reduction interventions on the so-called Brennero railway, Italy. The novelty of this paper is threefold. To our knowledge, this is the first study on the valuation of noise conducted in Italy and it is the first example of CE applied in the field of rail noise valuation. Second, we consider not only the economic value assessment of noise reduction but also how this reduction is achieved, ranging from policy instruments such as barriers or train technology. Third, the paper provides an original contribution in the valuation literature since we test formally the econometric robustness of the CE estimates under three payment vehicles. In fact, we consider (a) a special regional tax, (b) reallocation of financial resource within the provincial budget on the public transport sector, and (c) reallocation of financial resource of the provincial budget from the administration and entertainment sector. Test results are mixed. Welfare analysis and policy implications of valuing rail noise reduction programs using different payment vehicles are discussed.

Choice Experiment, Noise Abatement, Tax, Tax Reallocation, Formal Testing, Welfare Analysis

Abstract:
This multidisciplinary study adopts econometric analysis for investigating how different characteristics determine the choice of the language used in the signs of a shopping street. We work with a dataset containing about 200 observations collected in the main shopping streets of the cities of Donostia (Spain) and Ljouwert (The Netherlands). The results corroborate the important assumption that multilingualism and the choice of the language (even in a street sign) is an individual and a social preference. Therefore, understanding individuals' linguistic preference structures is preliminary to the target and design of proper linguistic and social policies.

Linguistic Diversity, Street Sign, Probit Model, Linguistic Landscape

Abstract:
In a democratic system, policy makers have to take the preferences of the citizens into account. Since we live in a world with scarce resources, one is asked to make choices regarding the use and management of these resources. In this context, if policy makers decide to invest in the protection of marine ecosystems, less financial resources will be available for other policy areas, for example national health. Moreover, the investment in the protection of marine ecosystems brings along with it the provision of a wide range of benefits to humans though most are not priced in the existing markets – for example climate regulation and provision of habitat for biodiversity. Given that most human activities are priced in one way or other, in some decision contexts, the temptation exists to downplay or ignore these important marine ecosystem benefits on the basis of the non-existence of prices. The simple and simplistic idea in the minds of many policymakers is that a lack of prices is equivalent to a lack of values. Clearly, this is a biased perspective. Against this background, this paper explores the motivation for an economic valuation of this complex resource. The state-of-the-art economic valuation methodologies follow the guidelines proposed by the Millennium Ecosystem Assessment, taking into account the existing scientific knowledge on the functioning of marine ecosystems, marine ecosystem goods and services and its impacts on human welfare. Finally, we critically review some economic valuation studies, arguing that the economic valuation of marine ecosystem services and biodiversity can make sense if and only if important guidelines are observed.

Economic Valuation, Marine Ecosystem, Millennium Ecosystem Assessment Approach, Europe

Abstract:
This analysis provides an example of how biodiversity can be measured by means of different indicators, and how the latter can be used to assess the influence of the biodiversity profile of a region on the tourism flows towards it. Previous studies have considered environmental amenities as one of the determinants of tourism destination choice. The central hypothesis of this paper is that the destination’s biodiversity profile can be considered as a key component of environmental amenities. The main objective of this study is to propose a different perspective on this topic, considering the role of biodiversity on tourists’ choice of destination and duration of stay. Domestic Irish tourist flows have been chosen as a case study. The first step of the analysis required the construction of biodiversity indicators suitable for developing a biodiversity profile of each Irish county. Subsequently, a model was developed so as to explain the total number of nights spent in any location as a function of a set of explanatory variables including information about the socio-demographic characteristics of respondents, biodiversity and the landscape profile of the county of destination and features of the trip. Results show that most of the biodiversity and landscape indicators included in the analysis turn out to be statistically significant in determining tourists’ choices regarding the duration of their trip. As a result, policies pursuing biodiversity conservation appear to have a positive impact on the revenue of regional tourism.

species diversity, habitat fragmentation, landscape diversity, trip demand, indicators, ecosystem services, human well-being