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1.3
Reasons for EconomicValuations and theValuation Process
People’sWell-being and Ecosystem Service
Trade-off Decisions
Economic valuations of LME ecosystem services are integral
to the TDA process and the socioeconomic indicator of the
five-module approach. While scientists must determine
the magnitude and priority of issues such as water quality,
biodiversity, fisheries and habitat degradation,
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ecological
data alone is not enough. Governments and stakeholders
must also be aware of the many socioeconomic benefits
derived from marine ecosystems in order to address the
competing interests that can lead to the exploitation of
fisheries and other marine resources.
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Policymakers must
acquire data about the people who depend on these
ecosystems. Where do these people live and what goods
and services do they derive from marine and coastal
ecosystems? What proportion of their well-being depends
on these ecosystems?
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Economic valuations help to delineate the relationship
between human well-being and ecosystem services. They
canaid inquantifyingtrade-offsbetweenecosystemservices
(one service could limit or damage another), between
costly conservation efforts, or between competing interests
of LME countries. Ecosystem service values can be weighed
against the worthiness of extraction of non-renewable
resources such as crude oil, sand, gravel or other mineral
resources. Although these inert substances are not true
“ecosystem services” as they do not derive value from the
existence of an ecosystem and its living components, they
do have value and share the same origin area as ecosystem
services. Knowing ecosystem service values helps to assess
outcomes when faced with abrupt or non-linear changes in
ecosystems or when completing the probabilistic analysis
of various future environmental scenarios.
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The EcosystemValuation Process
Economic valuations consist of a two-step process. Firstly,
the ecosystem services for review must be identified. The
Millennium Ecosystem Assessment (MA) provides a scientific
consensus regarding the four categories of ecosystem
services: “provisioning services” such as food, water, timber,
and fibre; “regulating services” that affect climate, floods,
disease, waste, and water quality; “cultural services” that
provide recreational, aesthetic, educational and spiritual
benefits; and “supporting services”
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such as photosynthesis,
soil formation or primary production, e.g. fish nurseries.
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Second, the value of the ecosystem is appraised, if possible, in
monetary terms.
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From a utilitarian perspective, ecosystem
services may have “use” and/or “non-use” values. Use values
can be “direct use” values such as fish or firewood; “indirect
use” values such as improved water quality or nutrient cycling;
or “option” values, which are values preserved for possible
future use either by an individual (“option”value) or by others
or heirs (“bequest” value).
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Non-use values are divided into