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The social benefits and costs of preserving forest biodiversity and ecosystem services

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  • Henrik Lindhjem
  • Kristine Grimsrud
  • Ståle Navrud
  • Stein Olav Kolle

Abstract

Ecologists recommend preserving more of the old-growth forests in Norway, as half of the species have forests as their main habitat and many are in decline. We investigate benefits and costs over a 50-year period of increasing forest conservation from 1.4% of the productive forest area (the situation in 2007) to 2.8% (doubling), 4.5% ('ecologists' minimum') and 10% (one goal suggested in public debate). The benefits are estimated based on a national contingent valuation (CV) survey of Norwegian households. Two independent measures of total costs are used: (1) the actual compensation amounts paid to forest owners and (2) results from a survey of forest owners' minimum willingness to accept compensation to preserve. Results show that social benefits outweigh costs of the three conservation plans by a large margin. The middle option of 4.5% has the highest net present value. This result is robust to a range of assumptions, including considerations of potential hypothetical bias in willingness to pay estimates. The results of this cost-benefit analysis reflect the preferences of the general population, the authorities and the forest owners with respect to biodiversity and ecosystem services conservation, and supplement the expert opinion of ecologists.

Suggested Citation

  • Henrik Lindhjem & Kristine Grimsrud & Ståle Navrud & Stein Olav Kolle, 2015. "The social benefits and costs of preserving forest biodiversity and ecosystem services," Journal of Environmental Economics and Policy, Taylor & Francis Journals, vol. 4(2), pages 202-222, July.
  • Handle: RePEc:taf:teepxx:v:4:y:2015:i:2:p:202-222
    DOI: 10.1080/21606544.2014.982201
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    Citations

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    Cited by:

    1. Whitehead, John C., 2016. "Plausible responsiveness to scope in contingent valuation," Ecological Economics, Elsevier, vol. 128(C), pages 17-22.
    2. Anne Stenger & Patrice Harou, 2015. "Special issue on forest investments profitability," Journal of Environmental Economics and Policy, Taylor & Francis Journals, vol. 4(2), pages 125-128, July.
    3. Jing Ning & Jianjun Jin & Foyuan Kuang & Xinyu Wan & Chenyang Zhang & Tong Guan, 2019. "The Valuation of Grassland Ecosystem Services in Inner Mongolia of China and Its Spatial Differences," Sustainability, MDPI, Open Access Journal, vol. 11(24), pages 1-14, December.
    4. Endre Kildal Iversen & Kristine Grimsrud & Henrik Lindhjem & Jette Bredahl Jacobsen, 2019. "Trade-offs between carbon sequestration, landscape aesthetics and biodiversity in a cost-benefit analysis of land use options in Norway," Discussion Papers 915, Statistics Norway, Research Department.
    5. Grimsrud, Kristine & Graesse, Maximo & Lindhjem, Henrik, 2020. "Using the generalised Q method in ecological economics: A better way to capture representative values and perspectives in ecosystem service management," Ecological Economics, Elsevier, vol. 170(C).
    6. Divinsky, Itai & Becker, Nir & Bar (Kutiel), Pua, 2017. "Ecosystem service tradeoff between grazing intensity and other services - A case study in Karei-Deshe experimental cattle range in northern Israel," Ecosystem Services, Elsevier, vol. 24(C), pages 16-27.

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