Valuation of ecosystem goods and services. Part 2: Implications of unpredictable novel change

This is the second part of a two-part paper which offers a new approach to the valuation of ecosystem goods and services. In the first part a simple pre-industrial model was introduced to show how the interdependencies between the three subsystems, society, economy and nature, influence values, and how values change over time. In this second part the assumption of perfect foresight is dropped. I argue that due to novelty and complexity ex ante unpredictable change occurs within the three subsystems society, economy and nature. Again the simple pre-industrial model, which was introduced in part 1, serves as a simple paradigm to show how unpredictable novel change limits the possibility to derive accurate estimates of values.

Exploring intra-commonwealth goods and services trade

A background paper for the Commonwealth Secretariat by Anirudh Shingal and Mohammad Razzaque: Existing work examining the trade effect of commonwealth membership does not account for sample selection, unobserved heterogeneity and multilateral resistance in estimation, leading to biased estimates. Our analyses improve on all these fronts. Unlike earlier work, we also consider services trade and assemble a much larger sample of trading partners (242 x 242, over 1995-2010). Commonwealth membership is found to increase goods exports by 18.5-33.2% and services exports by 42.8% in our results, ceteris paribus and on average. Our analyses on the determinants of intra-commonwealth trade suggest the positive role of common language (only for goods trade) and colonial relationships as well as the negative impact of geography, thereby confirming that commonwealth member states are not natural trading partners for each other. Finally, being one of Australia, Canada or the UK is associated with 98.2% greater merchandise trade than the commonwealth average; however, a similar effect is not observed for services trade.

To fuse or not to fuse? Assessing the case for convergent disciplines on goods and services trade

Think piece by Pierre Sauvé for the E15 Initiative on Strengthening the Global Trade System In his latest essay for the ICTSD-World Economic Forum E15 initiative on Strengthening the Global Trade and Investment System for Sustainable Development, WTI Director of External Programmes and Academic Partnerships and faculty member Pierre Sauvé explores the case for fusing the law of goods with that of services in a world of global value chains. The paper does so by directing attention to the questions of whether the current architectures of multilateral and preferential trade governance are compatible with a world of trade in tasks; whether the existing rules offer globally active firms a coherent structure for doing business in a predictable environment; whether it is feasible to redesign the structure and content of existing trade rules to align them to the reality of production fragmentation; and what steps can be envisaged to better align policy and realities in the marketplace if the prospects for restructuring appear unfavourable. The paper argues that fusing trade disciplines for goods and services is neither needed nor feasible and may actually deflect attention from a number of worthwhile policy initiatives where more realistic (if never easily secured) prospects of generic rule-making may well exist.

Exploring complementarities between goods and services trade in trade agreements

More than three decades of research on trade costs and goods trade have unveiled fundamental insights into the determinants, the nature and the consequences of goods trade agreements. A cottage literature has also evolved studying similar issues from a services trade perspective, but the two-way interaction between goods and services trade has not been explored formally. We bridge this gap by providing a formal treatment of the inter-linkages between goods and services trade. The model provides insights into how trade agreements impact goods and services trade. We also explore the impact of the complementarities of goods and services agreements on goods and services trade empirically using bilateral goods and services trade data for OECD and BRICS trading partners over 1995-2010.

Are shrubs really a sign of declining ecosystem function? Disentangling the myths and truths of woody encroachment in Australia

Since European settlement, there has been a dramatic increase in the density, cover and distribution of woody plants in former grassland and open woodland. There is a widespread belief that shrub encroachment is synonymous with declines in ecosystem functions, and often it is associated with landscape degradation or desertification. Indeed, this decline in ecosystem functioning is considered to be driven largely by the presence of the shrubs themselves. This prevailing paradigm has been the basis for an extensive program of shrub removal, based on the view that it is necessary to reinstate the original open woodland or grassland structure from which shrublands are thought to have been derived. We review existing scientific evidence, particularly focussed on eastern Australia, to question the notion that shrub encroachment leads to declines in ecosystem functions. We then summarise this scientific evidence into two conceptual models aimed at optimising landscape management to maximise the services provided by shrub-encroached areas. The first model seeks to reconcile the apparent conflicts between the patch- and landscape-level effects of shrubs. The second model identifies the ecosystem services derived from different stages of shrub encroachment. We also examined six ecosystem services provided by shrublands (biodiversity, soil C, hydrology, nutrient provision, grass growth and soil fertility) by using published and unpublished data. We demonstrated the following: (1) shrub effects on ecosystems are strongly scale-, species- and environment-dependent and, therefore, no standardised management should be applied to every case; (2) overgrazing dampens the generally positive effect of shrubs, leading to the misleading relationship between encroachment and degradation; (3) woody encroachment per se does not hinder any of the functions or services described above, rather it enhances many of them; (4) no single shrub-encroachment state (including grasslands without shrubs) will maximise all services; rather, the provision of ecosystem goods and services by shrublands requires a mixture of different states; and (5) there has been little rigorous assessment of the long-term effectiveness of removal and no evidence that this improves land condition in most cases. Our review provides the basis for an improved, scientifically based understanding and management of shrublands, so as to balance the competing goals of providing functional habitats, maintaining soil processes and sustaining pastoral livelihoods.

The Mountain Research Initiative Reaches Outward and Clombs Upward

Mountain regions provide a multitude of goods and services for much of humanity (Price and Butt 2000; Becker and Bugmann 2001), especially in the realms of water supply, biodiversity, and other ecosystem services (Schimel et al 2002; Körner et al 2005; Viviroli et al 2007; Viviroli et al 2011). However, the future ability of mountain regions to provide goods and services to both highland and lowland residents is seriously threatened by climatic changes, environmental pollution, unsustainable management of natural resources, and serious gaps in understanding of mountain systems (Huber et al 2005). Disciplinary, interdisciplinary, and transdisciplinary research is required to maintain these goods and services in the face of these forces. The global mountain research community, however, has historically operated at a suboptimal level because of insufficient communication across geographic and linguistic barriers, less than desirable coordination of research frameworks, and a lack of funding.

Discontinuity in the responses of ecosystem processes and multifunctionality to altered soil community composition

Ecosystem management policies increasingly emphasize provision of multiple, as opposed to single, ecosystem services. Management for such "multifunctionality" has stimulated research into the role that biodiversity plays in providing desired rates of multiple ecosystem processes. Positive effects of biodiversity on indices of multifunctionality are consistently found, primarily because species that are redundant for one ecosystem process under a given set of environmental conditions play a distinct role under different conditions or in the provision of another ecosystem process. Here we show that the positive effects of diversity (specifically community composition) on multifunctionality indices can also arise from a statistical fallacy analogous to Simpson's paradox (where aggregating data obscures causal relationships). We manipulated soil faunal community composition in combination with nitrogen fertilization of model grassland ecosystems and repeatedly measured five ecosystem processes related to plant productivity, carbon storage, and nutrient turnover. We calculated three common multifunctionality indices based on these processes and found that the functional complexity of the soil communities had a consistent positive effect on the indices. However, only two of the five ecosystem processes also responded positively to increasing complexity, whereas the other three responded neutrally or negatively. Furthermore, none of the individual processes responded to both the complexity and the nitrogen manipulations in a manner consistent with the indices. Our data show that multifunctionality indices can obscure relationships that exist between communities and key ecosystem processes, leading us to question their use in advancing theoretical understanding-and in management decisions-about how biodiversity is related to the provision of multiple ecosystem services.

Soils, agriculture and food security: The interplay between ecosystem functioning and human well-being

Healthy soils are critical to agriculture, and both are essential to enabling food security. Soil-related challenges include using soils and other natural resources sustainably, combating land and soil degradation, avoiding further reduction of soil-related ecosystem services, and ensuring that all agricultural land is managed sustainably. Agricultural challenges include improving the quantity and quality of agricultural outputs to satisfy rising human needs, also in a 2 degrees world; maintaining diversity in agricultural systems while supporting those farms with the highest potential for closing existing yield gaps; and providing a livelihood for about 2.6 billion mostly poor land users. The greatest needs and potentials lie in small-scale farming, although there as elsewhere, trade-offs must be negotiated within the nexus of water, energy, land and food, including the role of soil therein.

The Role of Goods Trade Networks for Services Trade Volume

In this paper, we address the role of countries’ goods-trade networks for their services-trade volume. The paper employs a large cross section of bilateral trade data on aggregate cross-border goods and services sales and illustrates that the depth and overlap of two countries’ services networks induce a positive direct impact on their services-trade volume. The evidence takes into account that goods trade flows and networks are potentially endogenous so that the estimated direct effects support a causal interpretation. We find that the magnitude of the multilateral goods-trade network effect on the bilateral services-trade volume is much larger than that of bilateral goods-trade volume.

A feasibility study for the provision of electronic healthcare tools and services in areas of Greece, Cyprus and Italy

Background Through this paper, we present the initial steps for the creation of an integrated platform for the provision of a series of eHealth tools and services to both citizens and travelers in isolated areas of thesoutheast Mediterranean, and on board ships travelling across it. The platform was created through an INTERREG IIIB ARCHIMED project called INTERMED. Methods The support of primary healthcare, home care and the continuous education of physicians are the three major issues that the proposed platform is trying to facilitate. The proposed system is based on state-of-the-art telemedicine systems and is able to provide the following healthcare services: i) Telecollaboration and teleconsultation services between remotely located healthcare providers, ii) telemedicine services in emergencies, iii) home telecare services for "at risk" citizens such as the elderly and patients with chronic diseases, and iv) eLearning services for the continuous training through seminars of both healthcare personnel (physicians, nurses etc) and persons supporting "at risk" citizens. These systems support data transmission over simple phone lines, internet connections, integrated services digital network/digital subscriber lines, satellite links, mobile networks (GPRS/3G), and wireless local area networks. The data corresponds, among others, to voice, vital biosignals, still medical images, video, and data used by eLearning applications. The proposed platform comprises several systems, each supporting different services. These were integrated using a common data storage and exchange scheme in order to achieve system interoperability in terms of software, language and national characteristics. Results The platform has been installed and evaluated in different rural and urban sites in Greece, Cyprus and Italy. The evaluation was mainly related to technical issues and user satisfaction. The selected sites are, among others, rural health centers, ambulances, homes of "at-risk" citizens, and a ferry. Conclusions The results proved the functionality and utilization of the platform in various rural places in Greece, Cyprus and Italy. However, further actions are needed to enable the local healthcare systems and the different population groups to be familiarized with, and use in their everyday lives, mature technological solutions for the provision of healthcare services.