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The economic value of forests in supplying local climate regulation

Author

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  • Figueroa, Eugenio
  • Pasten, Roberto

Abstract

Several authors have argued that forest ecosystems serve as a hedge against extreme climatic events at a local scale. Consequently, the local climate regulation ecosystem services provided by forests can be economically valued by evaluating the reduction (increase) in the insurance premium that risk-averse individuals are willing to pay when forest cover is marginally increased (reduced). This type of insurance value associated to forest ecosystems services is estimated to be USD 0.0733 per hectare of forest for Chilean farmers. The empirical framework proposed in this paper is useful and relevant for the cost-benefit analysis of natural resource conservation investments

Suggested Citation

  • Figueroa, Eugenio & Pasten, Roberto, 2015. "The economic value of forests in supplying local climate regulation," Australian Journal of Agricultural and Resource Economics, Australian Agricultural and Resource Economics Society, vol. 59(3), July.
    • Handle: RePEc:ags:aareaj:283212
    DOI: 10.22004/ag.econ.283212
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    Cited by:

    1. Valente, Donatella & Miglietta, Pier Paolo & Porrini, Donatella & Pasimeni, Maria Rita & Zurlini, Giovanni & Petrosillo, Irene, 2019. "A first analysis on the need to integrate ecological aspects into financial insurance," Ecological Modelling, Elsevier, vol. 392(C), pages 117-127.
    2. Dominic White & Niven Winchester, 2023. "Logs or permits? Forestry land use decisions in an emissions trading scheme," Australian Journal of Agricultural and Resource Economics, Australian Agricultural and Resource Economics Society, vol. 67(4), pages 558-575, October.
    3. Soto-Montes-de-Oca, Gloria & Bark, Rosalind & González-Arellano, Salomón, 2020. "Incorporating the insurance value of peri-urban ecosystem services into natural hazard policies and insurance products: Insights from Mexico," Ecological Economics, Elsevier, vol. 169(C).
    4. Agnieszka Lorek & Paweł Lorek, 2021. "Social Assessment of the Value of Forests and Protected Areas on the Example of the Silesian Voivodeship," Sustainability, MDPI, vol. 13(6), pages 1-12, March.
    5. Sun, Xuehui & Li, Xueming & Guan, Zhangnan & Liu, Jian & Zhang, Shuping, 2017. "The use of meteorological data to assess the cooling service of forests," Ecosystem Services, Elsevier, vol. 25(C), pages 28-34.

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    Keywords

    Environmental Economics and Policy;

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