Speaker Info

Dr. James Boyd
Director of Social Science and Policy at SESYNC
National Socio-Environmental Synthesis Center

Email: boyd@rff.org


Dr. James Boyd is the Director of Social Science and Policy at SESYNC (the National Socio-Environmental Synthesis Center), as well as the Director of RFF’s Center for the Management of Ecological Wealth and a senior fellow at Resources for the Future (Washington, DC). Dr. Boyd’s work focuses on the quantification and management of ecological resources and services. He graduated from the University of Pennsylvania’s Wharton School in 1993, with a PhD in microeconomics. Before working at SESYNC, Dr. Boyd worked for the RFF’s Energy and Natural Resources Division as a visiting Professor at both Stanford University and Washington University in St. Louis. He has also served with a variety of environmental advisory groups (including the National Academy of Science and the US EPA Science Advisory Board) and has performed environmental consulting work for a variety of consulting firms and agencies including the European Commission and the World Bank.

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Seminar Abstract

This lesson is intended as a primer for understanding environmental economics, focusing particularly on the valuation of ecosystem services. The first section of the presentation focuses on an economist’s typical perspective on how ecosystem services are to be analyzed – and in particular on the kinds of ecological analysis and outcomes needed for economic evaluation.  Boyd stresses the importance of being able to describe the effect of specific management actions on changed ecological outcomes via ecological “production functions.” He also stresses the importance of measured or modeled ecological outcomes that can be understood by lay audiences. Ecological analysis that causally relates specific management actions to changes in socially understandable biophysical outcomes allows for those outcomes to be valued in monetary terms.

The second section of the presentation focuses more heavily on how to economically quantify the importance of ecosystem services.  In order to fix a monetary value on an environmental variable that will affect ecosystem services, a variety of factors need to be taken into account: how many people are affected by this environmental outcome? What is the scale of the problem you are trying to address? How scarce are the resources involved? Are there substitutes for the ecosystem services that are becoming damaged or lost? As a result, when one is trying to fix a monetary value on an ecosystem – or communicate its benefit in non-monetary terms – it is important to capture such factors in the analysis. Boyd also discusses reasons why many economic studies under-estimate the total value of ecosystems.

Seminar Transcript

>> So it is my great pleasure to introduce Dr. Jim Boyd today. Jim and I go way back. We have been working on ecosystem services for decades. And Jim really has played an important role in his position as director of social sciences at SESYNC, which you all know is Socio-Environmental Synthesis Center. And also he is co-director of the Resources for the Future Center for the Management of Ecological Wealth. And he'll have to explain that. But I mean, I do -- I can you tell you that Jim's work really is a nice integration of ecology, economics, law and policy. And he has really worked at the interface of those fields to try to find, you know, metrics and ways to measure values that work for policymakers. And so with that I'll let him do his thing. >> Thank you Lisa. Well, yeah, I have titled this a primer. And I see my mission here as kind of getting some thoughts in front of you to help with this workshop you're going to have in a week or two. And it's my version of, in effect what I would suggest to a group like yours look for in ecosystem services analysis, what to really encourage, and then actually some things to watch out for as well. So that's kind of my overall mission. So think about this is a consumer guide, if you will, to ecosystem services analysis. And I'm going to give you my version of what good analysis means. And just to be clear what that is, I come from the perspective that what we're really trying to do here is inform policy analysis and decision-making. And then we want to be scientifically sound. And so I'm going to give you what I call kind of a mainstream version. There are kind of fringe approaches, if you will. We can talk about that but the tires on this basic framework I'm going to put in front of you have been kicked a lot. And not just by economists but by OMB for example, by my friends who are ecologists. And so it's been through that vetting process, if you will. And I'll just say that. So I want to start with an analogy that's going to -- oh, wait. First of all, I'm going to split this conversation into two pieces. And I am an economist, but I actually want the first piece to be about ecology. And that's because to do social analysis and economic analysis of these services, we kind of require ecology of a certain type. And so I want to tee up that conversation, and then we'll go into the economics. So anticipate a break here in the middle where, for you ecologists, you can let me have it and get any reactions. So the ecology. And I want to start with this analogy. This is a abstract from a regulatory impact analysis presented by the EPA to Congress and OMB. And I want to draw couple of lessons about it. It basically has to do with vehicle emissions and that's the regulation or the action that's being contemplated and a reduction in particulate matter to be specific. And then if you kind of jump here like why do we want to engage in this regulation? What's going on here is the outcomes of that, the socially desirable outcomes are being presented in this kind of quantitative way. We're going to get fewer deaths and numbers given to that, fewer episodes of sickness, fewer hospital admissions, things like that. And what I want to point out here first, and this is going to be my theme for the ecology, is that what we really want ecosystem services ecology to do is do something similar. Tie outcomes that resonate with communities and normal people, think of your next-door neighbor. This is going to resonate. These numbers are going to resonate with them. They get what that means to their own lives. And that's tied to a specific action, a management choice. The other thing I'll draw out from this example, and I'll come back to it, is you've got the things I describe, these quantitative outcome measures. And then at the end you've got another one, $65 billion. And one of the things I want to talk with you about and get your views on is how important is that dollar versus these things? And who are we trying to reach? And I'm a big fan of these kinds of things. And I'm actually a bit of a skeptic and critic of the dollar values. So we'll come to that. Okay. So I really have just a couple of simple themes here. And the main one is that a lot of the ecology that's done for a lot of very good reasons is not always tied to specific management actions. And what I mean by actions and, you know, how much nitrogen are we applying to farms? What kind of farming practices are being used? How many fish are being taken out of the water? How do we manage our treatment facilities and those kinds of things? Those are actions that policy incentives can actually change. And that's really what's in play and the choices about which we need to provide information, scientific information. But, again, a theme I'll develop here is a lot of ecology doesn't really tied back to those specific actions as much as we would like it to. And in the second theme is that the ecological outcomes that our science is measuring and reporting, to really connect to the social analysis, they need to be publicly meaningful. And, again, I mention my next-door neighbor. Something you could explain to your next-door neighbor why it's important, and they would understand that oh, yeah, I see why that's important. I did a kind of Google search and I found -- I haven't read these papers, so mea culpa, but I love the contrast in just the titles of them to kind of make this point. They're really kind of about the same thing, turbidity and seagrass. But the distinction between these two titles is that this one has this preventable sediment export, which I'm interpreting to be preventable as something we can manage, something we can actually affect. So it's got that nice front-end piece. What's the policy or the decision or the behavior we can influence? And then it actually says well, we're not just going to worry about seagrass, but we're going to worry about dugongs, which one of you can tell me more of what a dugong is. But I'm pretty sure dugongs would be more resonate with the public than seagrass itself. Why do we care about the seagrass? Well, because its habitat and forage for a species that's culturally important or recreationally important etcetera. So this one has the properties. The second title has more of the properties that I, as a social scientist, am looking for than this one does. And you could go into the literature and -- this kind of thing is pretty rare. To actually go all the way from an action you can take to an outcome that really resonates with people. So just to put this -- I'm really going to beat the dead horse here. But it's to make the point that economists and other social scientists, we are nothing without the ecology. And we know that. We don't always tell you that, but everything we do is really based on getting information from the ecological sciences and ecological community about these systems. And what we're doing is we're consuming this kind of systems knowledge. This is a very toy system, obviously. But the key thing is that we know that these different ecological processes really matter and have to be measured because what, again, we're trying to do is causally relate actions we can take. Where are we? And how many wetland acres are we going to restore or prevent from destruction? How much nitrogen is applied to farms or lawns? Should we replant forests, protect forest cover? Those are the choices we're making. They're choices about ecological inputs to the system. And when we change those inputs, we're then triggering this cascade of causal effects. You know, a relatively direct one might be to some aspect of water quality that then interacts, of course, with something about the seagrass. And then you need science to translate that into some kind of population abundance. So, again, I set this up so we've got concrete actions. We've got an outcome. It's usually not just one but an outcome that would make sense to your next-door neighbor. And then kind of another really important point I want to convey here is that what we're really looking for is incremental change. And I'm going to come back to this because a lot of economic studies you will see that are problematic aren't really focused on these incremental changes. In the real world, policy changes things incrementally. And then what we're looking for is an incremental change in these ecological outcomes and then we can do something with that as economists. It's impossible basically to say what's the value of the Chesapeake Bay? I'll explain why that is later. What it is possible to talk about is what's the value of an increase in crab population by x number or x percent or something like that? So that incremental piece is important. The final point I'll say about the ecological story here is getting to -- what are these ecological outcomes we really need to make this all fit together? And I use the term linking indicators, ecological endpoints some people use but, again, these are outcomes that are not scientifically understandable or meaningful but publicly meaningful. And an obvious benefit of these is that you can communicate with them. A less obvious benefit is that, to economists, you need those kinds of outcomes to do your economics. And let me give you some examples of why that's true. So if you're a scientist or a consumer of science, you may see papers and studies that give these kinds of outcome measures, a biotic integrity measure or some kind of chemical concentration related to water quality. I don't know what rotifer productivity is? Does anyone know what rotifer productivity is? Good. I had to have that. Actually, I do know what it is now but -- but try to put yourself in the shoes of someone who's -- again, what we're trying to do is reveal how much people care about a change in one of these things. And this stuff's nearly impossible to get people to understand, talk about. People's behavior doesn't -- isn't affected by some experience of these things. And so, again, in this workshop coming up, if you see studies that strike you as more like this kind of thing. Again, there's scientifically important. They're important for a lot of reasons. I'm not saying they're not important. But if you want to connect to the economics, it's a problem. And the solution to the problem is to do more ecology, unfortunately. So to make that point, you know, let's -- these are kind of just examples I'll run through but if you've got a study that says well, we've got some land management or any kind of management action or policy and it's going to improve surface water pH, again, an economist can't really do much with that. So the exercise you go through is like why is that important? And really, one reason it's important is that it can affect species abundance. And the things in this column are, again, things that I can do something with as a social scientist. But what it means is you may have to be thinking about doing this additional science about these intervening processes to translate some of your existing research into these kinds of outcome analyses. So I'm basically done with ecology. I just want to reiterate this checklist. Science that you can tie to decision relevant drivers and change. So how are farmers going to change their behavior? Cities, homeowners, fishermen, that kind of thing. And then can we actually get to a point where we can describe the causal effect of those management changes or actions on these publicly meaningful outcomes? I will say that this is easy to say. I am very aware that it's extremely difficult to pull this off. It requires synthesis. It requires usually multiple kinds of studies, diverse data sets, methodological expertise and so -- this is the aspiration, though. And with that I'd just like to kind of stop and get the feeling of the room and allow Lisa to weigh in.

Seminar Discussion

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