Protecting Natural Capital Through Ecosystem Service Districts

25 Pages Posted: 24 Sep 2001

See all articles by Geoffrey M. Heal

Geoffrey M. Heal

Columbia University - Columbia Business School, Finance; National Bureau of Economic Research (NBER)

Gretchen Daily

Stanford University - Department of Biology

Paul Ehrlich

Stanford University - Department of Biology

James E. Salzman

University of California, Santa Barbara (UCSB) - Donald Bren School of Environmental Science & Management; University of California, Los Angeles (UCLA) - School of Law

Carol Boggs

Stanford University - Center for Conservation Biology

Jessica Hellman

Stanford University - Center for Conservation Biology

Jennifer Hughes

Brown University

Claire Kremen

Princeton University - Department of Ecology and Evolutionary Biology

Taylor Ricketts

Stanford University - Center for Conservation Biology

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Abstract

In this article, we focus on the potential of governmental authorities dedicated to management of ecosystem services. We argue that the creation of such Ecosystem Service Districts (ESDs) will improve the efficient provision of services necessary for human welfare. At the moment, when agencies manage for natural resources, they typically do so in a defined geographical area or district. Given the prevalence and importance of districts for soil conservation, resource conservation, flood control, and other local services, we explain how ESDs could provide a coherent and efficient governmental institution for monitoring and investing in natural capital. A focus on ESDs would create a mechanism to help ensure that natural capital is protected and maintained with the same care and concern as that given to built and human capital.

Establishing and managing ESDs will involve an exploration of the underlying ecological processes that provide the services, of the economic significance of the services, and of the legal issues involved in managing natural ecosystems for the good of a local or regional community. Central in all these analyses will be land use decisions. Land use determines which of the initial ecosystems and services are maintained intact. In addition, many of the key trade-offs between the continued functioning of natural ecosystems and the extension of economic activities arise naturally in the context of land-use choices, such as farming versus forestation, development versus conservation, etc.

In examining the geographical, economic, and legal obstacles in designing ESDs, we suggest an integrative framework for managing the patterns of land use in a district that can provide several different ecosystem services, and that also has the potential to support many different types of economic activity, some of which can conflict with the continued integrity of the natural ecosystems. Part I of the article explains the why ecosystem services are under threat and the potential benefits of managing their conservation through ESDs. Part II lays out the basic ecological-economic framework and principles for district design. Part III sets out the key legal issues and Part IV presents a tentative roadmap of how to put theory into practice. The importance of ecosystem services is no longer disputed. How to realize more fully their value, and hence their conservation, however, remains an active research area. ESDs, though fraught with challenges, provide a potentially powerful institutional mechanism to address the relative neglect of ecosystem services in public policy by bringing their crucial importance into focus and aiding in their preservation.

Keywords: Ecosystem services, public goods, natural capital, environment, legal framework, environmental law

JEL Classification: H50, Q01, Q20, R00

Suggested Citation

Heal, Geoffrey M. and Daily, Gretchen and Ehrlich, Paul and Salzman, James E. and Boggs, Carol and Hellman, Jessica and Hughes, Jennifer and Kremen, Claire and Ricketts, Taylor, Protecting Natural Capital Through Ecosystem Service Districts. Available at SSRN: https://ssrn.com/abstract=279114 or http://dx.doi.org/10.2139/ssrn.279114

Geoffrey M. Heal (Contact Author)

Columbia University - Columbia Business School, Finance ( email )

3022 Broadway
New York, NY 10027
United States
212-854-6459 (Phone)
212-316-9219 (Fax)

HOME PAGE: http://www.gsb.columbia.edu/faculty/gheal/

National Bureau of Economic Research (NBER)

1050 Massachusetts Avenue
Cambridge, MA 02138
United States

Gretchen Daily

Stanford University - Department of Biology ( email )

Gilbert Building, Rm 109
371 Serra Mall
Stanford, CA 94305
United States

Paul Ehrlich

Stanford University - Department of Biology ( email )

Gilbert Building, Rm 109
371 Serra Mall
Stanford, CA 94305
United States
Not Available (Phone)
Not Available (Fax)

James E. Salzman

University of California, Santa Barbara (UCSB) - Donald Bren School of Environmental Science & Management ( email )

4670 Physical Sciences North
Santa Barbara, CA 93106-5131
United States

University of California, Los Angeles (UCLA) - School of Law ( email )

385 Charles E. Young Dr. East
Room 1242
Los Angeles, CA 90095-1476
United States

Carol Boggs

Stanford University - Center for Conservation Biology

Stanford, CA 94305
United States

Jessica Hellman

Stanford University - Center for Conservation Biology

Stanford, CA 94305
United States

Jennifer Hughes

Brown University

Department of Biology
Providence, RI 02912
United States

Claire Kremen

Princeton University - Department of Ecology and Evolutionary Biology ( email )

M31 Guyot Hall
Princeton, NJ 08544
United States
609-258-7313 (Phone)

Taylor Ricketts

Stanford University - Center for Conservation Biology

Stanford, CA 94305
United States

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