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Third, economic valuation of an ecosystem or its
services may be undertaken to justify or critique a
particular decision in a particular place, for ex-
ample, in a cost–benefit framework, where trade-
offs in relation to a set of decision-making alterna-
tives are to bemade. Relevant decisionsmay involve
regulating development impacts, assessing dam-
ages, determining access levels, setting user fees,
and determining optimum taxation levels. Particu-
lar use of economic valuation, in other words, is not
an abstract or theoretical exercise—it affects the
allocation and distribution of resources in real ways.
Moreover, the battlegrounds over these valuation
studies are not only in academic venues but court-
rooms, adversarial environments where the admis-
sion of uncertainty is damning (Binger and others
1995).
We are clearly sympathetic with the first two uses
of ecosystem valuation, where the goal is not to
summarize ecosystemserviceswith a single ‘‘bottom-
line’’ number, but to better understand the signifi-
cant connections between nature and society. We
outline a number of caveats with respect to ecosys-
tem complexity and the construction of human
values, leading us to conclude that the third use of
ecosystem valuation is less useful in ecosystem
management.
EXISTING FORMS OF VALUATION
Many natural scientists, who view human society as
a ‘‘subsystem’’ of the natural world, would argue
that ecosystemservices and life support are essential
for society irrespective of their recognition by hu-
mans. These services form the biogeophysical pre-
condition for social and economic development.
There are many ecosystem services that meet the
criteria of having economic value (they contribute
to well-being and are scarce) but for which humans
have not yet developed preferences. The decoupling
of preferences from the biophysical preconditions
results from simple ignorance and from a deeper,
modern ‘‘mental alienation’’ from nature. The out-
come of economic valuation studies is therefore
only as good as the values of the people being
assessed. Basing management of ecosystem services
solely onmarginal economic values of individuals in
a cost–benefit framework therefore may be an
unreliable guide to sustainable use of ecosystems.
Ecologists have sometimes used energy flowanaly-
sis as an alternative to economic valuation, with the
view that energy flow analysis reflects the biophysi-
cal preconditions for social and economic develop-
ment. Some studies focus on energy flow within a
sector or in the economy as a whole, whereas others