Evaluating the contribution of forest ecosystem services to societal welfare through linking dynamic ecosystem modelling with economic valuation

Trade-offs exist among the multiple ecosystem services (ES) generated by forests. Generally, wood production conflicts with the provisioning of public-good ES such as the storage of carbon, nutrient retention and conservation of biodiversity. Recognizing that forests generate both private- and public-good ES implies that forestry should be optimized to maximize the contribution of forests to societal welfare. Here we develop an integrated approach for evaluating the contribution of forest ES to welfare. Our approach links the results from dynamic ecosystem modelling to economic valuation and benefit-cost analysis to evaluate the impacts of alternative forestry practices on welfare. We apply the approach to a Norway spruce forest in southern Sweden. We show that current practices are not maximizing societal welfare, because of conflicts in the optimal choice of practices from society’s and forest owners’ perspectives, and the distribution of welfare between generations. In particular, intensifying biomass production is shown to reduce welfare due to the concomitant degradation of public-good ES, while welfare would improve through expansion of continuous cover forestry. We anticipate that this type of approach will aid the sustainable development of forestry, by informing decision makers of the impacts of alternative forestry practices on societal welfare.