The economic consequences of conserving or restoring sites for nature
Bradbury et al. 2021
This paper compared the economic costs and benefits of conserving or restoring habitats, with those of alternative land uses. The economic consequences of conservation or restoration was assessed in terms of value of ecosystem services across 62 sites. The benefits from conservation/restoration were divided into private benefits (i.e. excludable benefits: private goods, such as charges for entering a protected area, or profits from agriculture or logging), and public benefits (i.e. non-excludable benefits: public goods and common pool resources, such as greenhouse gas regulation and flood protection). The study found that conservation and restoration across all habitat types studied have considerable public benefits, which are often not accounted for during project planning.
Moreover, the public benefits usually outweighed the private benefits that motivated the change in land use; in these cases, the total value of the conserved/restored state was greater, even when accounting for all costs. Private benefits outweighed public benefits in only six studies, and in four of these cases this was driven by commodity crops with high prices. The results are thought to be conservative since not all ecosystem services were monetized, and those that were left out (such as air quality regulation) are likely to have higher values in the conserved/restored state. Hence, even when private benefits outweighed public benefits, this could be due to undervaluation or lack of inclusion of some public benefits.
This study provides strong evidence that it makes economic sense to incentivise private landowners to take into account public goods and common pool resources when managing land, such that its overall social value increases. In some cases this would lead to different management decisions, such as implementation of nature-based solutions rather than engineered alternatives, or altering the design of nature-based solutions in order to enhance the public benefits.
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