Elsevier

Ecological Economics

Volume 64, Issue 4, 1 February 2008, Pages 808-819
Ecological Economics

ANALYSIS
Valuation of the ecosystem services: A psycho-cultural perspective

https://doi.org/10.1016/j.ecolecon.2007.05.008Get rights and content

Abstract

Valuation of ecosystems services has been a challenging issue for economists. There is a growing concern to capture the total and incremental changes in services of different types of ecosystems, mainly, due to perturbations arising from anthropogenic activities. Market-based valuation techniques have long been declared inadequate and a constructed market method such as the contingent valuation method albeit a robust tool does not seem to capture the expanse, nuances, and intricacies of many of the ecosystem services. The paper attempts to address the lacunae in valuation of ecosystem services from a psychological perspective by arguing that the common person's perception of the ecosystem is quite different from what is conceptualized by conventional economists. The paper shows how the ecological identity of individuals is revealed at various levels of the decision-making hierarchy that is, from local to regional and further onto a global level. The paper builds upon insights from psychoanalytic psychology and environmental-psychology. Further, it outlines recent research findings from experimental psychology to redefine concepts such as ecological identity, self-other dichotomy, and the fostering of identification with nature, as issues that must be embraced in the valuation of ecosystem services. Extending the idea of relational goods and reciprocity, the paper offers a deconstructed view of market forces and furthers the idea of interdisciplinary collaboration and cooperation in the valuation of ecosystem services. In this perspective the dichotomy and schism between markets, missing markets and non-markets, gets renovated and reconstructed beyond a utilitarian discourse.

Introduction

One of the main reasons scientists and decision-makers are worried about the loss of ecosystems is that they provide valuable services which may be lost as they get degraded. Questions then arise. How valuable are these services? How robust are the estimated values of ecosystem services? Do these values take into account the multidimensional attributes of ecosystems? How plausible are the assumptions on which valuation methodologies are based? Are the features of ecosystem services distinct from those of normal goods and services that economists usually handle? Answers to these questions can lead to informed choices towards better management of ecosystems. One can also wonder that if the ecosystems are providing services valuable to the society then how come society is allowing it to degrade and lost. The answers to this might run along several tracks ranging from legal, technocentric to social and institutional aspects of ecosystem management options. One of the central points of the answer always remains the inadequacy in capturing the values of ecosystem services to the society. The inadequacy also emerges from the notion of value perceived by the stakeholders of the ecosystems. Our brief review suggests that valuation of ecosystem services is yet to evolve in a way, it could claim to capture the socio-psychological dimension of value and the exercise of valuation. We make an attempt to highlight this aspect of ecosystem services in this paper. Our observations could be true for economics science in general but we intend to keep it in the light of valuation of ecosystem services. We intend to organize the complexities of valuation of ecosystem services rather than just ignoring them.

The paper is divided into four sections. Section 1 begins with introduction. Section 2 offers the rationale for economic valuation of ecosystem services and evaluates the challenges economists face in the process. Section 3 presents a critical assessment of the assumptions behind valuation techniques frequently adopted for estimation of different ecosystems and their services. Psycho-social and cultural perspectives which raise concerns regarding the prevalent outlook and practices of economic sciences provide the backdrop for most of these criticisms. Finally, Section 4 synthesizes the criticism to provide the necessary roadmap towards a valuation of ecological services that could be acceptable to both theoreticians and the development practitioners.

Section snippets

Valuation of ecosystem services

Ecosystems are defined as the existence of biotic and abiotic resources and their complex interactions. It is a complex fabric of plant, animal, and other microscopic life and its interactions with the non-living environment. So, one can easily think of a system dominated by woody biomass as forest ecosystem, freshwater ecosystem, marine ecosystem, coastal ecosystem, cultivated ecosystem etc. The ecosystems, if in a good condition perform functions which are of bio-geophysical in nature. These

Psycho-cultural dimension of valuation

The proneness to decay of all that is beautiful and perfect can, as we know, give rise to two different impulses in the mind. The one leads to aching despondency …. While the other leads to the rebellion against the facts asserted. No! It is impossible that all this loveliness of Nature and Art, of the world of our sensations and of the world outside, will really fade away into nothing. But this demand for immortality is a product of our wishes too unmistakable to lay claim to reality: what is

Conclusions

Economic valuation of ecosystem services and subsequent benefits is critical for sustainable management of the ecosystems. Since these services accrued to the society are largely public in nature and are intangible bio-geochemical processes, they pose a formidable challenge in valuation. Some of the challenges of valuation emerge from the preanalytical bias of the assumption of neoclassical economics where the behavioral underpinnings of rational choices and subsequent resource allocation is

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  • Cited by (0)

    The authors would like to thank Prof. Joan Martinez-Alier and the anonymous referees of the Journal for their useful comments.

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