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Uncertainty in ecosystem services valuation and implications for assessing land use tradeoffs: An agricultural case study in the Minnesota River Basin

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  • Johnson, Kris A.
  • Polasky, Stephen
  • Nelson, Erik
  • Pennington, Derric

Abstract

Ecosystem services analysis can help recognize the full costs and benefits of land management decisions. Quantification and valuation of services can enhance policies and regulations and, if linked with payments or incentives, properly reward private decisions that yield public benefits. However, the field of ecosystem services research is relatively new and quantification and valuation remains highly uncertain. While there is significant uncertainty about the biophysical production of ecosystem services, there is additional uncertainty about the value of services. This paper explores how uncertainty associated with valuation of ecosystem services in agriculture affects the ranking of land use alternatives in terms of social net benefits. We compare the values of four land use scenarios in the Minnesota River Basin, USA, by combining a range of value estimates for these services with varying estimates for returns from agricultural production. Although variations in ecosystem service values are significant, fluctuations in agricultural returns more significantly determine how scenarios rank with regard to delivery of total value. This analysis suggests that addressing uncertainty in ecosystem service valuation is critical to accurately assessing tradeoffs in land use.

Suggested Citation

  • Johnson, Kris A. & Polasky, Stephen & Nelson, Erik & Pennington, Derric, 2012. "Uncertainty in ecosystem services valuation and implications for assessing land use tradeoffs: An agricultural case study in the Minnesota River Basin," Ecological Economics, Elsevier, vol. 79(C), pages 71-79.
  • Handle: RePEc:eee:ecolec:v:79:y:2012:i:c:p:71-79
    DOI: 10.1016/j.ecolecon.2012.04.020
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    1. Anton Strokov & Ekatherine Yakubovich & Pavel Krasilnikov, 2017. "Economic and Ecological Evaluation of Land Use Change: Evidence from Karelia," Economy of region, Centre for Economic Security, Institute of Economics of Ural Branch of Russian Academy of Sciences, vol. 1(2), pages 422-433.
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    3. Depietri, Yaella & Orenstein, Daniel E., 2020. "Managing fire risk at the wildland-urban interface requires reconciliation of tradeoffs between regulating and cultural ecosystem services," Ecosystem Services, Elsevier, vol. 44(C).
    4. Hackbart, Vivian C.S. & de Lima, Guilherme T.N.P. & dos Santos, Rozely F., 2017. "Theory and practice of water ecosystem services valuation: Where are we going?," Ecosystem Services, Elsevier, vol. 23(C), pages 218-227.
    5. Vasilis C. Kapsalis & Grigorios L. Kyriakopoulos & Konstantinos G. Aravossis, 2019. "Investigation of Ecosystem Services and Circular Economy Interactions under an Inter-organizational Framework," Energies, MDPI, Open Access Journal, vol. 12(9), pages 1-29, May.
    6. Ando Fahda Aulia & Harpinder Sandhu & Andrew C. Millington, 2020. "Quantifying the Economic Value of Ecosystem Services in Oil Palm Dominated Landscapes in Riau Province in Sumatra, Indonesia," Land, MDPI, Open Access Journal, vol. 9(6), pages 1-23, June.
    7. Mueller, Hannah & Hamilton, David P. & Doole, Graeme J., 2016. "Evaluating services and damage costs of degradation of a major lake ecosystem," Ecosystem Services, Elsevier, vol. 22(PB), pages 370-380.
    8. Utkur Djanibekov & Asia Khamzina, 2016. "Stochastic Economic Assessment of Afforestation on Marginal Land in Irrigated Farming System," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 63(1), pages 95-117, January.
    9. Nguyen, Minh Duc & Ancev, Tiho & Randall, Alan, 2020. "Forest governance and economic values of forest ecosystem services in Vietnam," Land Use Policy, Elsevier, vol. 97(C).
    10. Walston, Leroy J. & Li, Yudi & Hartmann, Heidi M. & Macknick, Jordan & Hanson, Aaron & Nootenboom, Chris & Lonsdorf, Eric & Hellmann, Jessica, 2021. "Modeling the ecosystem services of native vegetation management practices at solar energy facilities in the Midwestern United States," Ecosystem Services, Elsevier, vol. 47(C).
    11. Xueting Zeng & Liang Cui & Qian Tan & Zhong Li & Guohe Huang, 2018. "A Sustainable Land Utilization Pattern for Confirming Integrity of Economic and Ecological Objectives under Uncertainties," Sustainability, MDPI, Open Access Journal, vol. 10(5), pages 1-18, April.
    12. Ruckelshaus, Mary & McKenzie, Emily & Tallis, Heather & Guerry, Anne & Daily, Gretchen & Kareiva, Peter & Polasky, Stephen & Ricketts, Taylor & Bhagabati, Nirmal & Wood, Spencer A. & Bernhardt, Joanna, 2015. "Notes from the field: Lessons learned from using ecosystem service approaches to inform real-world decisions," Ecological Economics, Elsevier, vol. 115(C), pages 11-21.
    13. Wainger, L. & Ervin, D., 2017. "The Valuation of Ecosystem Services from Farms and Forests Informing a systematic approach to quantifying benefits of conservation programs (Synthesis Chapter)," C-FARE Reports 260677, Council on Food, Agricultural, and Resource Economics (C-FARE).
    14. Noe, Ryan R. & Nachman, Elizabeth R. & Heavenrich, Hannah R. & Keeler, Bonnie L. & Hernández, Daniel L. & Hill, Jason D., 2016. "Assessing uncertainty in the profitability of prairie biomass production with ecosystem service compensation," Ecosystem Services, Elsevier, vol. 21(PA), pages 103-108.
    15. Bianca Tilliger & Beatriz Rodríguez-Labajos & Jesus Victor Bustamante & Josef Settele, 2015. "Disentangling Values in the Interrelations between Cultural Ecosystem Services and Landscape Conservation—A Case Study of the Ifugao Rice Terraces in the Philippines," Land, MDPI, Open Access Journal, vol. 4(3), pages 1-26, September.
    16. Susan Stratton Sayre, 2019. "Pay for the Option to Pay? The Impact of Improved Scientific Information on Payments for Ecosystem Services," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 73(2), pages 591-625, June.
    17. Lu, Zhixiang & Wei, Yongping & Xiao, Honglang & Zou, Songbing & Ren, Juan & Lyle, Clive, 2015. "Trade-offs between midstream agricultural production and downstream ecological sustainability in the Heihe River basin in the past half century," Agricultural Water Management, Elsevier, vol. 152(C), pages 233-242.
    18. Johnson, Kris A. & Dalzell, Brent J. & Donahue, Marie & Gourevitch, Jesse & Johnson, Dennis L. & Karlovits, Greg S. & Keeler, Bonnie & Smith, Jason T., 2016. "Conservation Reserve Program (CRP) lands provide ecosystem service benefits that exceed land rental payment costs," Ecosystem Services, Elsevier, vol. 18(C), pages 175-185.
    19. Lee, Jongyeol & Kim, Hyungsub & Song, Cholho & Kim, Gang Sun & Lee, Woo-Kyun & Son, Yowhan, 2020. "Determining economically viable forest management option with consideration of ecosystem services in Korea: A strategy after successful national forestation," Ecosystem Services, Elsevier, vol. 41(C).
    20. Saraiva Farinha, Maycon Jorge Ulisses & Mario Bernardo, Luciana Virginia & Filho, Adelsom Soares & Berezuk, André Geraldo & da Silva, Luciana Ferreira & Ruviaro, Clandio Favarini, 2019. "Opportunity cost of a private reserve of natural heritage, Cerrado biome – Brazil," Land Use Policy, Elsevier, vol. 81(C), pages 49-57.
    21. Jung A Lee & Jinhyung Chon & Changwoo Ahn, 2014. "Planning Landscape Corridors in Ecological Infrastructure Using Least-Cost Path Methods Based on the Value of Ecosystem Services," Sustainability, MDPI, Open Access Journal, vol. 6(11), pages 1-22, October.
    22. Léa Tardieu, 2017. "The need for integrated spatial assessments in ecosystem service mapping," Review of Agricultural, Food and Environmental Studies, Springer, vol. 98(3), pages 173-200, December.

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