Coastal Ecosystem Valuation: A Sequential Decision Support System

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Coastal Ecosystem Valuation A Sequential
Decision Support System
Tiziana Luisetti, R. Kerry Turner, Sian
Morse-Jones, and Brendan Fisher CSERGE, School
of Environmental Sciences, University of East
Anglia ESRC Seminar Series - York 13th January
2009
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Case study the Blackwater estuary

• 5,500 hectares with open water, mudflats and
  saltmarshes

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Managed realignment
Pressures

• Sea level rise (climate change isostatic
  pressure)
• Disappearing intertidal habitats (coastal squeeze)

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Ecosystem services approach
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Blackwater ecosystem services
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Potential benefits and their valuation

• Flood defence cost savings
• Carbon storage
• Fisheries production
• Amenity, recreation and biodiversity
• (composite environmental
• benefit)

• Maintenance cost (km/yr)
• Damage cost avoided
• Market analysis
• Stated preference techniques (choice experiment)

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Important considerations in economic valuation
and a sequential decision support system
Spatial explicitness
Marginal Changes
Double counting
Non linearities
Threshold Effects
The next unit loss must not be capable of tipping
the ecosystem into an alternative state
Ecosystem service provision and beneficiaries
heterogeneity across spaces should be incorporated
Economic theory requires that changes are
relatively small or incremental
Competition and/or complementarities between
individual services should be identified
Non-linearities in services, benefits, and costs
require explicit consideration
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Spatial Explicitness

• ES are context dependent in terms of their
  provision and associated benefits and costs
• Many service values change across landscape, due
  to geographical variation in biophysical supply
  or demand
• eg how scarce or abundant clean water
• eg how large the adjacent population is or how
  wealthy they are (distance decay)
• Other service values will be constant across
  landscape or globally
• eg. value of carbon stored (damage costs
  avoided)

Important to understand underlying biophysical
structure and processes through spatially
explicit models
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Marginality

• Relatively small, incremental changes rather than
  large state changing impacts
• In practise can be confusing to apply -
  scientific uncertainty thresholds
• Since ES cross scales (local, regional, global),
  it requires consideration of scale of policy
  decision
• Think about next unit in terms of geographic
  extent a policy decision could encompass (see
  Fisher et al)

• The Blackwater estuary provides ecosystem
  services across scales
• Local - flood protection amenity and recreation
• Regional fish production
• Global carbon storage biodiversity

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Double counting

• Occurs where
• COMPETING services are valued separately AND the
  values aggregated
• Or, where an intermediate service is first valued
  separately, but ALSO subsequently through
  contribution to final service benefit
• Very few examples directly seek to address the
  DC issue
• Turner et al (2007) treat environmental benefits
  provided by creation of inter-tidal habitats as
  composite value i.e. nutrient storage function
  incorporated as an intermediate service to final
  benefit of enhanced amenity and recreational
  quality
• The Blackwater case study (Luisetti et al 2008)
  use a composite value (composite environmental
  benefit) obtained with a specific on site value
  investigation

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Non-linearities

• Many ecosystem respond non-linearly to
  disturbances
• If CBA assumes linearity, but service provision
  is non-linear, economic values may be biased
  policy outcomes polarised

• Barbier et al (2008)
• Storm damage protection service of Thailand
  mangrove
• Nonlinear relationship between wave attenuation
  habitat area (Panel 4)

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Threshold Effects

• Threshold effects refer to the point at which an
  ecosystem may change abruptly into an alternative
  steady state
• For marginality to hold, next unit should not
  tip system over a threshold or safe minimum
  standard (SMS)
• It is not always clear when the threshold is
  reached - requires expert input
• Often acknowledged in literature but rarely
  explicitly incorporated

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A sequential decision support system
considerations
To be useful ES must be assessed within their
appropriate spatial context and economic
valuation should provide marginal estimates of
value (avoiding double-counting) that can feed
into decisions at the appropriate scale, which
recognise possible non-linearities, and are well
within bounds of SMS.
Spatial explicitness
Marginal Changes
Double counting
Non linearities
Threshold Effects
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Choice experiment design

• Binary Choice Experiment
• Fractional factorial design
• 8 choices per respondent
• Near sample Essex
• Far sample Norfolk Suffolk

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Choice experiment implementation
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Choice experiment implementation
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Choice experiment implementation

• Focus on methodological issues rather than
  representativeness (non-probability sample)
• Face-to-face interviews at various locations
• Sample collected
• 576 Essex (locals)
• 288 Norfolk Suffolk (non-locals)
• Sample analysed
• 346 Essex (Near sample)
• 162 Norfolk Suffolk (Far sample)

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Choice experiment model specification Random
effects binomial logit
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Near sample results
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Concluding comments

• The CBA reinforced previous positive NPV findings
• This more adaptive approach to coastal policy
  should be set in an appropriate context
  (conditioned by local factors and circumstances)
• Extensive use of managed realignment would
  involve a complex mixture of political, social,
  economic and ethical concerns
• CBA as an heuristic aid