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Environmental and Resource Economics

, Volume 71, Issue 1, pp 205–215 | Cite as

Ecosystem Service Valuation for National Accounting: A Reply to Obst, Hein and Edens (2016)

  • Nils Droste
  • Bartosz Bartkowski
Article

Abstract

While recent experimental frameworks for national ecosystem service accounting have shown substantial progress, in our view some crucial methodological issues remain that deserve further consideration before setting final standards. In response to the landmark work of Obst et al. (Environ Resour Econ 64:1–23, 2016. doi: 10.1007/s10640-015-9921-1), we provide arguments with regard to the suitability of particular valuation approaches. Generally, we agree that respective valuation methods need to produce values that are consistent with national accounting standards such as representing exchange values. However, we disagree with their conclusions regarding specific valuation techniques. Firstly, the circumstance that methods used for estimating shadow prices can also be used to derive consumer surplus does not justify the general exclusion of all shadow pricing methods for valuation of ecosystem services for national accounts, especially for public ecosystem services. Secondly, that preference-based methods can also be used to assess welfare changes does not imply that cost-based methods are generally better suited for ecosystem accounting. To the contrary, we see an essential need for preference information in accounting contexts. Thirdly, that accounting standards use a written-down replacement cost approach, does not mean ecosystem accounting requires to employ a replacement cost approach. To the contrary, we argue that assessing ecosystem degradation through restoration costs would be in line with writing down depreciation, but we also point to its limits.

Keywords

Accounting standards Ecosystem services Economic valuation Natural capital 

Abbreviations

CE

Discrete choice experiment

CS

Consumer surplus

CV

Contingent valuation

MEA

Millennium ecosystem assessment

SEEA

System of environmental economic accounting

SEEA-EEA

SEEA 2012 experimental ecosystem accounting

SNA

System of national accounts

SP

Stated preference

TEEB

The economics of ecosystems and biodiversity

UK

United Kingdom of Great Britain and Northern Ireland

UN

United Nations

WTP

Willingness to pay

JEL Classification

E01 Q01 Q51 Q56 Q57 

Notes

Acknowledgements

We thank Jasper Meya and our colleagues at the Department of Economics at the UFZ - Helmholtz Centre for Environmental Research for helpful discussions. Furthermore, we are grateful for the comments of two anonymous referees which helped greatly to improve our manuscript. Any remaining errors remain our sole responsibility.

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Copyright information

© Springer Science+Business Media Dordrecht 2017

Authors and Affiliations

  1. 1.Department of EconomicsUFZ - Helmholtz Centre for Environmental ResearchLeipzigGermany

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