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ThesisUniversity of Iceland>Félagsvísindasvið>Meistaraprófsritgerðir>

Please use this identifier to cite or link to this item: http://hdl.handle.net/1946/4358


Economic valuation of ecosystem services, the case of Lake Elliðavatn and Lake Vífilsstaðavatn


Managing the environment is a complicated task constantly faced by decision-makers
in all the world´s communities. In Iceland heated debates have been going on over the
recent years concerning whether natural areas should be industrially developed or
protected for recreational purposes. The aim of this paper is to bring another
perspective to the Icelandic debate, an economic valuation of ecosystem services. The
term “ecosystem services” refers to the benefits human population derives from
ecosystems. The ecosystem services provided by two lakes in the capital area of
Iceland, Lake Elliðavatn and Lake Vífilsstaðavatn were assessed according to the
categorization scheme of the Millennium Ecosystem Assessment (MEA) published in
2005. The MEA classifies ecosystem services into four categories; provisioning
services, regulating services, cultural services and supporting services. Services from
each category were identified and valued with economic valuation methods; market
price, defensive behavior, travel cost and factor income. The final result is that the
annual value of ecosystem services provided by Lake Elliðavatn in 2009 is in the
range of ISK 83.263.647 - 101.308.524 (constant ISK 2009). For Lake Vífilsstaðavatn
this value is in the range of ISK 5.713.925 - 5.981.560 (constant ISK 2009). It was
concluded that although an economic valuation of ecosystem services can only serve
as an indicator of a potential value of the ecosystem services provision, it still
provides an important contribution to the debate of environmental manament in


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