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Agriculture, water, and ecosystems: avoiding the costs of going too far


services for their livelihoods, and they have often lacked a voice in making decisions about these services (Carbonell, Nathai-Gyan, and Finlayson 2001). Many local people who depend on ecosystems have had to develop management practices to deal with distur- bances and change in a way that builds socioecological resilience (Berkes and Folke 1998).

  • ey can contribute their understanding of fundamental ecosystem processes (Olsson,

Folke, and Hahn 2004). For the social mechanisms of dealing with the conflicts that oc- cur when making tradeoffs see chapter 5 on policies and institutions and chapter 16 on river basins.

New tools are emerging for dealing with tradeoffs, including some that provide economic incentives and support the formulation of policies and regulations. Given past failures to secure the wider range of ecosystem services, we highlight the need for develop- ing and adopting tools that can be used in striking tradeoffs between water for different ecosystem services. Such tools include economic valuation and cost-benefit analysis of ecosystem services, assessment of environmental flows, risk and vulnerability assessments, strategic and environmental impact assessments, and probability-based modeling.

Successful employment of such tools requires an adequate information base and im- proved predictive capacity about how ecosystems respond to change, and articulation of what is unknown or uncertain (Carpenter and others 2001). While the use of such tools has been increasingly promoted through international forums, conventions, and treaties, lack of awareness and capacity still seems to impede their use. We focus here on two tools that have considerable potential to assist in making tradeoffs: economic valuation of eco- system services and allocation of environmental flows.

Ecosystem valuation. Economic valuation is a powerful tool for addressing the tradeoffs between food production and other ecosystem services when making decisions about water management in agriculture. Its broad aim is to quantify the benefits (both market and nonmarket) that people obtain from ecosystem services to enable decisionmakers and the

A wide range of methods are available for valuing eco­ systems beyond the use of direct market prices

box 6.12

The total economic value of ecosystems

Total economic value involves assessing the value of four categories of ecosystem services:

  • Direct use values are derived from ecosystem services that are used directly by people and in- clude the value of consumptive uses, such as the harvesting of food products, timber, medicinal products, and the hunting of animals, as well as the value of nonconsumptive uses, such as the enjoyment of recreational and cultural amenities, water sports, and spiritual and social services.

  • Indirect use values are derived from ecosystem services that provide benets outside the eco- system itself, for example, the water ltration function of wetlands, the storm protection function of mangrove forests and delta islands, and carbon sequestration by forests.

  • Option values are derived from preserving the option to use services in the future rather than now, either by oneself (option value) or by heirs or others (bequest value).

  • Nonuse (or existence) values refer to the value people may place on knowing that a resource exists even if they never use that resource directly.

Source: MEA 2005b.


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