Considering the land-cover elasticity of ecosystem service value coefficients improves assessments of large land-use changes

Economic development often impacts on ecosystem services. Previous studies have raised public and political awareness of the costs associated with such impacts and the benefits of ecosystem services. In cases where empirical information on the value of ecosystem services is lacking, benefit transfer (BT) approaches that use value estimates from a previously studied site to estimate the economic values of a new target area have been established. One of the most popular BT approaches is unit value transfer, where constant ecosystem service value coefficients are used to assess a given land-use/land-cover (LULC) change. In several case studies assessing LULC changes, such unit value transfers with constant value coefficients are biased when nonmarginal changes are involved. Theoretical considerations suggest that large changes in land allocation should alter the opportunity costs of gaining or losing natural capital because the marginal costs of additional losses increase as some LULC types become scarcer (e.g. natural ecosystems). In contrast, marginal benefits shrink as other LULC types become more abundant (e.g. agricultural replacement systems).