Valuing our ecosystem

When you go to a grocery store, the tomatoes, box of pasta or can of tuna you buy each have a price tag. But goods and services in the environment - think clean water, tree cover, or flood control - don't come with a price tag.

Researchers in the University of Delaware Department of Applied Economics and Statistics have received a $1.5 million grant from the U.S. Army Engineer Research and Development Center, the chief research and development center for the federal environmental engineering agency U.S. Army Corps of Engineers. With the three-year grant, the UD environmental economists will develop a web-based platform for the Corps to help it assess the value of what is gained or lost from its environmental projects.

Maik Kecinski, University of Delaware associate professor in the Department of Applied Economics and Statistics, said many of the Corps' projects involve natural resources, such as building dams or restoring rivers. Those projects require labor hours and equipment, each with a market value.

"But the big piece the Corps doesn't have is what is the environmental value that's created or lost through these projects?" Kecinski said.

Showing value

Kecinski, the lead researcher on the project, will work with department colleagues Kent Messer and Martin Heintzelman, as well as three graduate researchers, to create an online platform to help the Corps estimate the monetary value of the ecosystem impacts through its ongoing and proposed projects across the U.S.

To create this online portal, the researchers will comb through thousands of pages of academic literature on the Corps' past projects to gauge the value of ecosystem services. One of the projects they will analyze is ERDC's oyster restoration in the Gulf of Mexico and the value of that restoration. ERDC worked with the University of Southern Mississippi to create oyster reef habitat in the Gulf and help re-establish the oyster population.

"Oysters are fantastic for water filtration and oyster reefs provide protection from storm surge and hurricanes," Kecinski said. "The more oysters you have, the better it is for that particular body of water."

Measuring the dollar value of environmental and natural resources is a big part of environmental economics. But it is not easy.

Kecinski said. "How do you know how much clean air is worth to you? What is the difference between slightly polluted drinking water, less polluted or more polluted? How do you put a value on that?"

However, Kecinski said that there is good economic science that can help us estimate these values.

"Life depends on natural resources," Kecinski said. "But often we just take that for granted."

Given the environmental magnitude of the agency's work, the value of ecosystem services gains and losses from the Corps' projects is particularly important. The Corps has worked to restore reef habitat in the Chesapeake Bay to help oyster populations thrive. For decades, it has built large water-related infrastructure projects, such as dams and wetland projects, across the country. The Corps has also worked to ensure rivers and other water bodies are navigable and cleaned up abandoned industrial sites across the U.S. known as "brownfields."