“After all those cosy years of working
    together, show me the money”
From economic valuation to real-world investment i...
Image: MP de Wit




Mountains of complexity..
•   Total Economic Value of Cape                                     Investing in Natural Assets
    Floral Kingdom at lea...
From knowledge to investment
Argument

      •    Transmission

      •    Cognition

      •    Reference

      •    Eff...
Barriers in the economic
            argument
•   Economic valuation studies are by
    definition partial and static

•   ...
Valuation as if decision makers matter



•   Valuation of joint products or multiple services

•   Values before and afte...
Predictable receptors?

•   Simple behavioural rules can
    create complex outcomes

•   Large number of small,
    incre...
Taking receptors seriously

•   Realities of the decision-making process itself
    need to be explicitly included

    • ...
Barriers in transmission

•   Divergence between
    analysts and decision
    makers

•   Mis-communication


           ...
Transmitting with ease

•   Personal relationships and trust between
    researchers and decision makers are important
   ...
Conclusions
•   Economic argument needs to be
    made within the context of Total
    Systems Value

•   Choices by decis...
An investment in knowledge always pays the best
                     interest.

  Benjamin Franklin (1706 - 1790), US auth...
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De Wit Key Note Address V1

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The last decade has seen several studies demonstrating the economic value of ecosystems and the fynbos biome is no exception. Despite notable criticism on some of these studies, on average they have succeeded in raising the awareness on the value of well-functioning ecosystems. In some instances this has led to conservation and restoration success on the ground, but what is needed is an institutional system that will translate abstract economic values into real financial investments in ecosystems. With continued increased pressure on the world’s biodiversity on the one hand and shifting agendas towards climate change and a rather reductionist and in practice partial ecosystems goods and services (EGS) analysis on the other, economists and ecologists need to build on their successes and find new meaning in their work on total systems value, as opposed to a focus on total economic value (TEV) or an EGS analysis only. Economists and ecologists would also do well by soliciting the services of those who can assist in the development of new institutional processes and arrangements that can capture the real financial benefits of well-functioning ecosystems beyond the usual short-term and consumptive benefits. Based on a analysis of current bottlenecks to realise real-world investments in specifically fynbos ecosystems, an action-orientated agenda focussed on performing economic valuation studies to better serve the needs of decision makers, an increased understanding of and leverage of total systems value, and a renewed focus on the institutional process and arrangements to capture fynbos ecosystem values, is proposed.

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De Wit Key Note Address V1

  1. 1. “After all those cosy years of working together, show me the money” From economic valuation to real-world investment in the fynbos biome Keynote address at Fynbos Forum, Bredasdorp, 6 August 2009 by Martin de Wit
  2. 2. Image: MP de Wit Mountains of complexity..
  3. 3. • Total Economic Value of Cape Investing in Natural Assets Floral Kingdom at least A business case for the environment in the City of Cape Town R10bn per year • Water, tourism, flower Martin de Wit, De Wit Sustainable Options (Pty) Ltd (Project Leader) Hugo van Zyl, Independent Economic Researchers Doug Crookes, Independent harvesting, existence values James Blignaut, Beatus CC Terence Jayiya, Jaymat Enviro Solutions CC Valerie Goiset, De Wit Sustainable Options (Pty) Ltd Brian Mahumani, De Wit Sustainable Options (Pty) Ltd Prepared by Natural Value Joint Venture c/o PO Box 546 Brackenfell 7561 Prepared for Arne Purves City of Cape Town High value ecosystems, but too little investment. Why?
  4. 4. From knowledge to investment Argument • Transmission • Cognition • Reference • Effort • Influence • Application Images: Flickr
  5. 5. Barriers in the economic argument • Economic valuation studies are by definition partial and static • Proving that fynbos has an economic value does not provide the cash • In many times it is only the start of a long institutional process of market creation Images: Flickr
  6. 6. Valuation as if decision makers matter • Valuation of joint products or multiple services • Values before and after environmental change • Valuation at different states of ecosystem disturbance • Include valuation studies in a dynamic systems- wide framework
  7. 7. Predictable receptors? • Simple behavioural rules can create complex outcomes • Large number of small, incremental changes in budgets from year to year, followed by sudden rapid changes Image: Flickr
  8. 8. Taking receptors seriously • Realities of the decision-making process itself need to be explicitly included • networks and relationships, • why certain subjects and alternatives are considered for the policy agenda while others are not Image: Flickr • role of knowledge in power dynamics in particular contexts
  9. 9. Barriers in transmission • Divergence between analysts and decision makers • Mis-communication Image: Flickr Know how to listen, and you will profit even from those who talk badly. Plutarch, Greek biographer & moralist (46 AD - 120 AD)
  10. 10. Transmitting with ease • Personal relationships and trust between researchers and decision makers are important facilitators of the use of research evidence • Communication strategy: Who Says What In Which Channel To Whom With What Effect?
  11. 11. Conclusions • Economic argument needs to be made within the context of Total Systems Value • Choices by decision makers are driven by heuristic rules leading to complexity • Deep-seated divergence between the cultures of analysts and decision makers • Need for effective communication Images: CoCT
  12. 12. An investment in knowledge always pays the best interest. Benjamin Franklin (1706 - 1790), US author, diplomat, inventor, physicist, politician, & printer
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