Incorporating insurance value into ecosystem services assessments: Mitigation of ecosystem users’ welfare uncertainty through biological control

Peled, Yoav; Zemah-Shamir, Shiri; Israel, Álvaro; Shechter, Mordechai; Ofir, E.

doi:10.1016/j.ecoser.2020.101192

Cited by 8 publications

(1 citation statement)

References 48 publications

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“…An examination of NBS efficiency can be completed through marginal analysis by computing the NBS total value (𝑉 𝑇 ). Following Baumgärtner and Strunz (2014) or Peled et al (2020), total value is defined as the sum of the economic (𝑉 𝐸 ) and insurance (𝑉 𝐼 ) values. The former is defined as the marginal increase in gross margin resulting from a one-unit increase in input (Debertin, 2012) and the latter is defined as the marginal decrease of risk premium allowed by an incremental unit of input (Baumgärtner, 2007).…”

Section: Theoretical Modelmentioning

confidence: 99%

Evaluating the efficient use of ecosystem processes for agricultural production: an empirical analysis of the implementation of a nature-based solution in intensive crop systems

Faure,

Gaba,

Perrot

et al. 2024

Preprint

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Nature-based solutions (NBSs) can ensure food production while providing environmental benefits, but there is little scientific knowledge about their economically efficient use. This study fills this gap by investigating NBSs in an agricultural production model calibrated on empirical data. We propose an original framework based on the framework in Saha et al. (1997), to which we add an explicit model of ecological dynamics. We then apply this amended framework to a case study in France and combine unique ecological, agronomic, psychological, and economic data to estimate and simulate NBS efficiency. We study a form of NBS – the preservation and restoration of semi-natural habitats (SNHs) – and show that the optimal landscape coverage is 17.5%, twice the extent of the current coverage at the study site. Our study supports the rate recommended in existing ecology-based studies and goes further by introducing new productivity-based arguments. We also show that SNH efficiency conditions are shaped by risk preferences and the number of ecosystem services under consideration. The total value of SNHs is twice lower when risk preferences are not considered and four times higher when multiple ecosystem services are modeled. The study opens new avenues to include NBSs in the traditional agricultural economics frameworks and warns about the importance of choices in the modeling process.

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