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Day B, Mancini M, Bateman IJ, Binner A, Cho F, de Gol A, Ferguson-Gow H, Fezzi C, Lee C, Liuzzo L, Lovett A, Owen N, Pearson RG, Smith G. Natural capital approaches for the optimal design of policies for nature recovery. Philos Trans R Soc Lond B Biol Sci 2024; 379:20220327. [PMID: 38643789 PMCID: PMC11033054 DOI: 10.1098/rstb.2022.0327] [Citation(s) in RCA: 0] [Impact Index Per Article: 0] [Reference Citation Analysis] [What about the content of this article? (0)] [Affiliation(s)] [Abstract] [Key Words] [MESH Headings] [Grants] [Track Full Text] [Journal Information] [Subscribe] [Scholar Register] [Received: 03/24/2023] [Accepted: 11/21/2023] [Indexed: 04/23/2024] Open
Abstract
By embedding a spatially explicit ecosystem services modelling tool within a policy simulator we examine the insights that natural capital analysis can bring to the design of policies for nature recovery. Our study is illustrated through a case example of policies incentivising the establishment of new natural habitat in England. We find that a policy mirroring the current practice of offering payments per hectare of habitat creation fails to break even, delivering less value in improved flows of ecosystem services than public money spent and only 26% of that which is theoretically achievable. Using optimization methods, we discover that progressively more efficient outcomes are delivered by policies that optimally price activities (34%), quantities of environmental change (55%) and ecosystem service value flows (81%). Further, we show that additionally attaining targets for unmonetized ecosystem services (in our case, biodiversity) demands trade-offs in delivery of monetized services. For some policy instruments it is not even possible to achieve the targets. Finally, we establish that extending policy instruments to offer payments for unmonetized services delivers target-achieving and value-maximizing policy designs. Our findings reveal that policy design is of first-order importance in determining the efficiency and efficacy of programmes pursuing nature recovery. This article is part of the theme issue 'Bringing nature into decision-making'.
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Affiliation(s)
- Brett Day
- Land, Environment, Economics and Policy Institute, Department of Economics, University of Exeter Business School, Exeter EX4 4PU, UK
| | - Mattia Mancini
- Land, Environment, Economics and Policy Institute, Department of Economics, University of Exeter Business School, Exeter EX4 4PU, UK
| | - Ian J. Bateman
- Land, Environment, Economics and Policy Institute, Department of Economics, University of Exeter Business School, Exeter EX4 4PU, UK
| | - Amy Binner
- Land, Environment, Economics and Policy Institute, Department of Economics, University of Exeter Business School, Exeter EX4 4PU, UK
| | - Frankie Cho
- Land, Environment, Economics and Policy Institute, Department of Economics, University of Exeter Business School, Exeter EX4 4PU, UK
- Centre for Biodiversity and Conservation Science, School of Earth and Environmental Science, University of Queensland, Brisbane, QLD 4072, Australia
| | - Anthony de Gol
- School of Environmental Sciences, University of East Anglia, Norwich NR4 7TJ, UK
| | - Henry Ferguson-Gow
- Centre for Biodiversity and Environment Research, University College London, Gower Street, London WC1E 6BT, UK
| | - Carlo Fezzi
- Land, Environment, Economics and Policy Institute, Department of Economics, University of Exeter Business School, Exeter EX4 4PU, UK
- Department of Economics and Management, University of Trento, via Inama 5, I-38122 Trento, Italy
| | - Christopher Lee
- Land, Environment, Economics and Policy Institute, Department of Economics, University of Exeter Business School, Exeter EX4 4PU, UK
| | - Lorena Liuzzo
- Land, Environment, Economics and Policy Institute, Department of Economics, University of Exeter Business School, Exeter EX4 4PU, UK
| | - Andrew Lovett
- School of Environmental Sciences, University of East Anglia, Norwich NR4 7TJ, UK
| | - Nathan Owen
- Land, Environment, Economics and Policy Institute, Department of Economics, University of Exeter Business School, Exeter EX4 4PU, UK
| | - Richard G. Pearson
- Centre for Biodiversity and Environment Research, University College London, Gower Street, London WC1E 6BT, UK
| | - Greg Smith
- Land, Environment, Economics and Policy Institute, Department of Economics, University of Exeter Business School, Exeter EX4 4PU, UK
- CSIRO, Castray Esplanade, Battery Point, Hobart, Tas 7004, Australia
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