Values, Payments and Institutions for Ecosystem Management

Values, Payments and Institutions for Ecosystem Management

A Developing Country Perspective

Edited by Pushpam Kumar and Ibrahim Thiaw

Using a selection of authoritative and original contributions, this timely book explores the uncertainty surrounding the impact of decisions undertaken to manage ecosystem services worldwide. Invariably, the policies designed and implemented to manage forests, wetlands, and marine and coastal environments often involve conflicts of interest between various stakeholders. This has added an additional layer of complexity in the context of developing countries where institutions and governance are weak or absent. Economic valuation and the subsequent design of innovative response tools such as payment for ecosystem services (PES) have the potential to offer far greater transparency. In the case of LDCs, the identification of suitable institutions for executing these tools is also of vital importance.

Chapter 1: Values, payments and institutions for ecosystem management: a developing country perspective

Pushpam Kumar and Ibrahim Thiaw

Subjects: development studies, development economics, economics and finance, development economics, environmental economics, environment, ecological economics, environmental economics, management natural resources, valuation


Ecosystem services are the benefits provided for human well-being from functioning ecosystems (Millennium Ecosystem Assessment 2005; Nelson et al. 2009). Ecosystems themselves are highly valuable natural capital, and ecosystem services provide direct and indirect benefits essential to sustain and fulfil life, as well as supporting important parts of the economy (Millennium Ecosystem Assessment 2005; Huberman 2008; Nelson et al. 2009). Indeed, the short-term economic benefits of many of the anthropogenic activities currently degrading ecosystems are eclipsed by the long-term economic, ecological and social values of the services that they provide (Sharma et al. 2008; Wunder et al. 2008). There are four main categories of ecosystem services: provisioning, regulating, supporting and cultural. Provisioning services such as food, water, fuel and fibre have a clear market value and are, therefore, easier to quantify (Tallis and Kareiva 2005; Muradian and Kumar 2009). Regulating (e.g. flood control and preventing soil erosion), supporting (e.g. nutrient cycling and soil formation) and cultural services (e.g. recreation and spiritual appreciation) have greater uncertainty with regards to biophysical production functions and are, therefore, more difficult to capture in terms of economics (Kumar and Kumar 2008).

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