Environmental economic evaluation

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The environmental economic evaluation is an economic method for decision support and planning. In standard applications of environmental economic evaluation, environmental changes are evaluated against a comparative state, usually against the status quo . It can be about changes in near-natural or used ecosystems or changes in their advantageousness or usability.

The method can be used to carry out cost-benefit analyzes , to support the overall environmental-economic calculation or to demonstrate the value of the biosphere in a generally comprehensible unit. Environmental economic assessments often use the concept of total economic value or ecosystem services .

Ethical and welfare economic fundamentals

The environmental economic assessment is explicitly based on an anthropocentric perspective. It is controversial whether this precludes the inclusion of intrinsic values in the concept of total economic value.

The methodology of environmental economic evaluation is based on the welfare measures developed by Alfred Marshall and especially John R. Hicks .

Methods

There are a number of methods for determining the economic value of environmental goods . They are usually divided into four groups: market price-based methods, cost-based methods, methods of revealed preferences, and methods of expressed preferences.

Market price based methods

Market price-based methods (including direct market valuation methods) are used for goods that are traded on markets (such as game meat or wild fruits) and therefore have market prices. These are then interpreted according to the principles of welfare economics as the value of the environmental good in question. If necessary, the value of an environmental good can also be calculated by estimating its contribution to various processes (production function method).

Cost-based methods

When using cost-based methods, one makes use of indirect costs of measures that are related to the environmental good in question. There are four methods in this group:

  • Opportunity cost method : the economic advantages of alternative uses that must be avoided in order to preserve the environmental good are interpreted as an approximation of its value;
  • Avoidance cost method : the costs caused by the protection of the environmental asset are interpreted as its value;
  • Replacement costs method : the costs of the technical substitution of the services provided by an ecosystem (e.g. water purification) are equated with the value of these services.
  • Restoration cost method : the cost of restoring the environmental asset after its reversible destruction is interpreted as its value (e.g. the cost of rewetting bogs).

The cost-based methods are controversial in environmental economics because, unlike other valuation methods, they are not preference-based . This means that they relate to the technological possibility of certain measures, not to their desirability in terms of preferences.

Methods of revealed preferences

The revealed preference methods use data on market prices of goods whose value is influenced by certain environmental goods. Statistical methods are then used to calculate how much the environmental good must have contributed to certain (buying) behavior. There are two methods in this category:

  • The hedonic price approach is based on the analysis of market prices for real estate: statistical methods are used to calculate how much the differences in a characteristic (environmental asset, e.g. proximity to a forest) affect the relative price of real estate under otherwise identical conditions.
  • The travel cost method can be used to assess the economic value of recreational areas, national parks, etc. Ä. to calculate. To do this, the costs that people incur to visit such a place are analyzed - this is then its minimum value. Alternatively, similar to the hedonic price approach, several possible travel destinations can be compared with one another with regard to their characteristics ( site choice travel cost method ).

Methods of expressed preferences

The methods of expressed preferences are the only method class that is able to estimate non-use-dependent values ​​(see total economic value ) of environmental goods. This survey-based methods are based on the construction of hypothetical situations ( "Markets"), in which the respondents meet with fictitious decisions that make then their willingness to pay ( willingness to pay , WTP ) to accept or willingness compensation payments ( willingness to accept compensation , WTA ) can be calculated for a given change in the provision of an environmental good. The two most common methods in this category are the contingent assessment method and the choice experiment .

Benefit transfer

The benefit transfer (BT; eng. Also rarely values ​​transfer ) is not an evaluation method in the narrower sense, but rather an approach to determining the value of an environmental good with the help of already existing evaluation data of other, similar environmental goods. Different variants are used, from a simple unit BT in which the value determined on the so-called study site is simply taken over for an identical item on the so-called policy site ; via an adjusted unit BT , in which the value determined in the study site is adjusted with a correction factor for differences to the policy site (e.g. in median income); and via the value function BT , in which various parameters are adjusted in the course of the transfer; up to meta-analytic BT , in which the values ​​from several study sites are taken as a basis.

Discounting

In the context of cost-benefit analysis , the discounting of future benefits is of crucial importance: in order to compare the costs and benefits of an environmental measure that occur at different points in time, one has to discount it to its present value according to economic theory . It is controversial in environmental economics which discount rate should be used when considering public environmental goods.

use

Environmental economic evaluation studies are carried out with different objectives. This includes:

The Costanza Study

By far the best-known and most frequently cited environmental economic evaluation study is The value of the world's ecosystem services and natural capital , published in Nature in 1997 by a team of authors led by Robert Costanza . The authors, who mainly used the benefit transfer approach, estimated the total economic value of the biosphere at 33 trillion US dollars (mean), with a range of 16 to 54 trillion. Despite its popularity in the media, the study has been widely used by economists, e.g. T. massively criticized, u. a. in a symposium edition of the journal Ecological Economics . One of the commentators called the estimate “a serious underestimate of infinity.” The main point of criticism is the contradiction in which the study’s statement on economic theory stands: environmental-economic evaluation is based on (in relation to income) marginal changes in the environmental good to be evaluated during the value estimated by Costanza and colleagues exceeded the world gross national product (which had been used as a measure of human income, so to speak).

criticism

Environmental economic evaluation is often the object of criticism, both in academia and in the media. Various points of criticism are raised:

  • Economic evaluation of nature leads to the suppression of moral arguments for environmental protection, because it is based on an anthropocentric worldview and focuses on monetary values. Different problems are identified: the exclusion of alternative " valuation languages "; the suppression of moral motivation through monetary incentives (cf. corruption effect ); as well as neglecting the intrinsic value of nature.
  • The use of monetary metrics leads to the commodification of nature, be it through the environmental-economic assessment itself, be it through Payments for Ecosystem Services , emissions trading and similar economic instruments. Sometimes this is understood as an expression of the advance of neoliberalism .
  • In many cases, the complexity of ecosystems is an important limit for the informative value and meaningfulness of an environmental-economic assessment, especially when it is applied in the context of a cost-benefit analysis.
  • The economic value of the services provided by nature also depends on the distribution of income in a society. Individual income influences the value that people attribute to the services of nature. The social distribution of income thus also influences the value that society as a whole attaches to nature.
  • Specifically with reference to methods of expressed preferences (such as contingent evaluation and choice experiments ), the objection is that their results are often in contradiction with the underlying economic theory and are therefore useless, and that such methods help people in their role as consumers with citizens get confused.
  • In a report commissioned by the BfN and IUCN on the ethical lines of argument in the National Strategy on Biodiversity , it was pointed out that although it is helpful for politicians to “quantify the costs of preserving biological diversity, so that they can counteract the can weigh the presumed costs of their loss ", but from an" ethical perspective [...] not only the amount of costs and benefits is important, but above all the question of their distribution. "

See also

literature

  • Bernd Hansjürgens , Nele Lienhoop: What nature is worth to us: Potentials of economic evaluation . Metropolis, Marburg 2015, ISBN 978-3-7316-1144-8 .
  • Pushpam Kumar (Ed.): The Economics of Ecosystems and Biodiversity: Ecological and Economic Foundations . Routledge, London / New York 2010, ISBN 978-1-84971-212-5 .
  • A. Myrick Freeman III: The Measurement of Environmental and Resource Values: Theory and Methods . Resources for the Future, Washington DC 1993, ISBN 0-915707-68-3 .

Individual evidence

  1. ^ A b Robert Costanza et al .: Changes in the global value of ecosystem services . In: Global Environmental Change . tape 26 , 2014, p. 152–158 , doi : 10.1016 / j.gloenvcha.2014.04.002 ( researchgate.net [PDF; 900 kB ]).
  2. ^ Marc D. Davidson: On the relation between ecosystem services, intrinsic value, existence value and economic valuation . In: Ecological Economics . tape 95 , 2013, p. 171–177 , doi : 10.1016 / j.ecolecon.2013.09.002 .
  3. ^ Katie McShane: Intrinsic values ​​and economic valuation . In: Clive L. Spash (Ed.): Routledge Handbook of Ecological Economics: Nature and Society . Routledge , New York 2017, ISBN 978-1-138-93151-0 , pp. 237-245 .
  4. ↑ Nancy Bockstael u. a .: On measuring economic values ​​for nature . In: Environmental Science & Technology . tape 34 , no. 8 , 2000, pp. 1384-1389 , doi : 10.1021 / es990673l .
  5. ^ Stefan Baumgärtner, Moritz A. Drupp, Jasper N Meya, Jan M Munz, Martin F. Quaas: Income Inequality and Willingness to Pay for Public Environmental Goods . In: SSRN Electronic Journal . 2016, ISSN  1556-5068 , doi : 10.2139 / ssrn.2739748 .
  6. ↑ Kenneth Arrow et al .: Should Governments Use a Declining Discount Rate in Project Analysis? In: Review of Environmental Economics and Policy . tape 8 , no. 2 , 2014, p. 145-163 , doi : 10.1093 / reep / reu008 .
  7. ↑ See also the chapter Discounting, Ethics and Options for Maintaining Biodiversity and Ecosystem Integrity in the first TEEB report .
  8. ^ Robert Costanza et al .: Influential publications in ecological economics: a citation analysis . In: Ecological Economics . tape 50 , 2004, pp. 261–292 , doi : 10.1016 / j.ecolecon.2004.06.001 ( rpi.edu [PDF; 400 kB ]).
  9. ↑ A search of the Web of Science on December 15, 2014 with the keywords "economic valuation" OR "economic value" yielded the Costanza article as by far the most cited result with 5031 citations.
  10. ^ Robert Costanza et al .: The value of the world's ecosystem services and natural capital . In: Nature . tape 387 , no. 6630 , 1997, pp. 253-260 , doi : 10.1038 / 387253a0 .
  11. ↑ Michael Toman: Why not to calculate the value of the world's ecosystem services and natural capital . In: Ecological Economics . tape 25 , no. 1 , 1998, p. 58 , doi : 10.1016 / S0921-8009 (98) 00017-2 ( univ-brest.fr [PDF; 100 kB ]).
  12. ^ David W. Pearce: Do we really care about Biodiversity? In: Environmental and Resources Economics . tape 37 , no. 1 , 2007, p. 313–333 , doi : 10.1007 / s10640-007-9118-3 ( inra.fr [PDF; 300 kB ]).
  13. ^ Douglas J. McCauley: Selling out on nature . In: Nature . tape 443 , no. 7107 , 2006, pp. 27-28 , doi : 10.1038 / 443027a .
  14. ↑ Put a price on nature? We must stop this neoliberal road to ruin , the text of a lecture by George Monbiot , accessed on February 6, 2015.
  15. ↑ Alex Y. Lo and Clive L. Spash: Deliberative monetary valuation: In search of a democratic and value plural approach to environmental policy . In: Journal of Economic Surveys . tape 27 , no. 4 , 2013, p. 768–789 , doi : 10.1111 / j.1467-6419.2011.00718.x ( researchgate.net [PDF; 100 kB ]).
  16. ^ Julian Rode, Erik Gómez-Baggethun, Torsten Krause: Motivation crowding by economic incentives in conservation policy: A review of the empirical evidence . In: Ecological Economics . 2015, doi : 10.1016 / j.ecolecon.2014.11.019 ( ufz.de [PDF; 300 kB ]).
  17. ^ Marc D. Davidson: On the relation between ecosystem services, intrinsic value, existence value and economic valuation . In: Ecological Economics . tape 95 , 2013, p. 171–177 , doi : 10.1016 / j.ecolecon.2013.09.002 .
  18. ↑ Erik Gómez-Beggethun and Manuel Ruiz Pérez: Economic valuation and the commodification of ecosystem services . In: Progress in Physical Geography . tape 35 , no. 5 , 2011, p. 613–628 , doi : 10.1177 / 0309133311421708 ( colmex.mx [PDF; 200 kB ]).
  19. ^ Giorgios Kallis, Erik Gómez-Baggethun, Christos Zografos: To value or not to value? That is not the question . In: Ecological Economics . tape 94 , 2013, p. 97-105 , doi : 10.1016 / j.ecolecon.2013.07.002 .
  20. ↑ Jessica Dempsey and Morgan M. Robertson: Ecosystem services: Tensions, impurities, and points of engagement within neoliberalism . In: Progress in Human Geography . tape 36 , no. 6 , 2012, p. 758-779 , doi : 10.1177 / 0309132512437076 ( colmex.mx [PDF; 300 kB ]).
  21. ^ Giulia Wegner and Unai Pascual: Cost-benefit analysis in the context of ecosystem services for human well-being: A multidisciplinary critique . In: Global Environmental Change . tape 21 , no. 2 , 2011, doi : 10.1016 / j.gloenvcha.2010.12.008 ( unep.org [PDF; 400 kB ]).
  22. ↑ Moritz A. Drupp, Jasper N. Meya, Stefan Baumgartner, Martin F. Quaas: Economic Inequality and the Value of Nature . In: Ecological Economics . tape 150 , August 2018, ISSN  0921-8009 , p. 340-345 , doi : 10.1016 / j.ecolecon.2018.03.029 .
  23. ↑ Bengt Kristrom, Pere Riera: Is the income elasticity of environmental improvements less than one? In: Environmental & Resource Economics . tape 7 , no. 1 , January 1996, ISSN  0924-6460 , p. 45-55 , doi : 10.1007 / bf00420426 .
  24. ↑ Stefan Baumggrtner, Moritz A. Drupp, Jasper N Meya, Jan M Munz, Martin F. Quaas: Income Inequality and Willingness to Pay for Public Environmental Goods . In: SSRN Electronic Journal . 2016, ISSN  1556-5068 , doi : 10.2139 / ssrn.2739748 .
  25. ^ Peter A. Diamond and Jerry A. Hausman : Contingent valuation: Is some number better than no number? In: The Journal of Economic Perspectives . tape 8 , no. 4 , 1994, pp. 45–64 ( lse.ac.uk [PDF; 600 kB ]).
  26. ↑ Amartya Sen : Environmental Evaluation and Social Choice: Contingent Valuation and the Market Analogy . In: Japanese Economic Review . tape 46 , no. 1 , 1995, p. 23-37 , doi : 10.1111 / j.1468-5876.1995.tb00003.x .
  27. ^ Mark Sagoff: The Economy of the Earth: Philosophy, Law, and the Environment . Cambridge University Press, Cambridge / New York 1988, ISBN 0-521-34113-2 ( limited preview in Google Book Search).
  28. ↑ Uta Eser, Ann-Kathrin Neureuther, Albrecht Müller: Klugheit, Glück, Gerechtigkeit: Ethical lines of argument in the National Strategy for Biodiversity . BfN, Bonn 2010, p. 33 ( English version ).