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Valuing indirect ecosystem services: the case of tropical watersheds

Published online by Cambridge University Press:  02 October 2002

Brooks Kaiser
Affiliation:
Department of Economics, Gettysburg College Box 391, Gettysburg, PA, 17325.
James Roumasset
Affiliation:
Department of Economics, University of Hawaii, Manoa, Social Sciences Building, Room 542, 2424 Maile Way, Honolulu, Hawaii 96822.

Abstract

Mitigating the harmful effects of development projects and industries (negative environmentalism) is inadequate, especially in resource-dependent economies whose resources are at risk from other forces. While positive environmentalism includes conservation projects, the non-market benefits of such projects are difficult to evaluate. This paper provides and illustrates a method for evaluating the indirect, watershed benefits of a tropical forest, without resorting to survey methods. The conservation of trees prevents a reapportionment from groundwater recharge to runoff that would otherwise occur. The value of the water saved is then valued at the shadow prices obtained from an optimizing model. An illustration of the model shows that watershed conservation projects may have very high payoffs, even before assessing existence values and other forest amenities.

Type
Research Article
Copyright
© 2002 Cambridge University Press

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