Ecosystem Services from Agriculture: Steps for Expanding Markets

Ecological Economics 69 (2010) 2085–2092

9 Pages Posted: 20 Feb 2016

See all articles by Marc Ribaudo

Marc Ribaudo

U.S. Department of Agriculture (USDA) - Economic Research Service (ERS)

Catherine Greene

U.S. Department of Agriculture (USDA) - Economic Research Service (ERS)

LeRoy Hansen

U.S. Department of Agriculture (USDA) - Economic Research Service (ERS)

Daniel Hellerstein

U.S. Department of Agriculture (USDA) - Economic Research Service (ERS), Resource and Rural Economics Division

Date Written: February 19, 2010

Abstract

Farmers in the United States produce a wide variety of commodities for food and fiber. Farmers can also produce a variety of non-commodity ecosystem services for which markets do not exist or are imperfectly formed. Such services may be valued by society, but due to their nature or institutional arrangements, farmers often do not receive a price signal for them. This results in inefficient allocations of resources, in that farmers under-produce non-commodity ecosystem services. One possible way to increase private investment in ecosystem services is to create a market for them. We draw lessons from six different markets for providing ecosystem services from farms (water quality trading, wetland mitigation, carbon cap and trade, over-the-counter carbon, eco-labeling, and fee hunting) on what is required for a market to function, and the problems these markets might face.

Keywords: Ecosystem service, Market, Social good, Demand

JEL Classification: Q21, H41

Suggested Citation

Ribaudo, Marc and Greene, Catherine and Hansen, LeRoy Thomas and Hellerstein, Daniel, Ecosystem Services from Agriculture: Steps for Expanding Markets (February 19, 2010). Ecological Economics 69 (2010) 2085–2092. Available at SSRN: https://ssrn.com/abstract=2735126

Marc Ribaudo (Contact Author)

U.S. Department of Agriculture (USDA) - Economic Research Service (ERS) ( email )

355 E Street, SW
Washington, DC 20024-3221
United States
202-694-5488 (Phone)
202-502-6174 (Fax)

Catherine Greene

U.S. Department of Agriculture (USDA) - Economic Research Service (ERS) ( email )

355 E Street, SW
Washington, DC 20024-3221
United States
202-694-5541 (Phone)

LeRoy Thomas Hansen

U.S. Department of Agriculture (USDA) - Economic Research Service (ERS) ( email )

355 E St., SW
Washington, DC 20036-5831
United States
202-694-5612 (Phone)

Daniel Hellerstein

U.S. Department of Agriculture (USDA) - Economic Research Service (ERS), Resource and Rural Economics Division ( email )

355 E Street, SW
Washington, DC 20024-3221
United States
202-694-5613 (Phone)
202-694-5756 (Fax)

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