Understanding the Value of Conservation

1. Timothy W Kelsey, Professor of Agricultural Economics Understanding the Value of Conservation

2. Outline • Why is Conservation Important? • Values • Describing the Value of Conservation to Others

3. Why is Conservation important?

5. With Natural Resource and Land Use Decisions – If people are willing to pay, what’s the problem?

6. Who Decides? Who Pays? Fairness

7. Conservation is Different Than Many Decisions • Decisions have ‘Joint Impact’ • Often Involves Fairness • Who makes land and resource decisions? • Who bears the costs? (or… who can impose costs on whom?)

8. Types of Value • Economic Benefits (income, jobs, …) • Costs Avoided • Non-monetary • Fairness • Scenic beauty • Innate human need for wilderness • Biodiversity • Carbon sequestration • …..

9. One way to describe this to the public and funders Describe the Public Value OF Conservation

10. 1. What is Public Value?

11. “Why should the public help pay for conservation?”

12. You have to be able to answer when a stakeholder asks: • “Why should I pay for a state park that other people go to, but which I’ll never visit?” • “Why should I pay to help prevent development on farmland, or on forest land?” • “I’ve seen the evidence that your program makes a difference, but why can’t the users pay for this, or you use a grant? Why should my dollars pay for this to help others?”

13. Private Benefits vs. Public Benefits Groups can well explain the value of their programs to participants (“private benefits”). But “public value” is the value of a program to those who do not directly participate in the program.

14. What is public value? “We need to communicate the ‘public value’ of the program to the program’s ‘authorizers.’ We need to explain why our services should be public, rather than private.” Mark Moore, Creating Public Value

15. Know Your Audience • Certain benefits/values appeal more to one group than to another • Cost savings? • Jobs? • Biodiversity? • Aesthetics? • Tailor your argument for your audience

16. 2. How has Extension used Public Value?

17. Public Value Statements…in the field Publications Annual reports Program flyers/brochures News articles Meetings (Face-to-Face, Advisory Boards, Elevators) Budget Defense Formal Presentations

18. Impact in Simple Terms “Getting your well water tested… reduces healthcare costs and improves water quality in the wider watershed area”

19. Preserving a Program Budget/Funding Active West Nile Programs show reduction in larval habitats, proper use of pesticides, fewer mosquitoes/bites, less pesticide use….resulting in reduced illness or loss of work, less stress on families, and fewer healthcare costs.

20. 3. How to Understand Public Value

21. Three criteria for a product or service to be provided by the public sector • The public sector provides information that allows consumers to make better choices. • The provision of the good or service addresses a crucial concern about fairness. • The private sector will not provide the good or service at adequate levels: market failure. • Consumers create public benefits • Producers create public benefits

22. 1. Public sector intervention can be justified by an information gap What: A consumer cannot make the best choice for herself because she has incomplete or incorrect information about the product or service she is going to buy. The public sector provides information that improves the consumer’s ability to make the best choices for herself. Extension program examples: Nutrition information, comparative statistics for financial products, value of timber contracts, value of gas leases

23. Does your program address aninformation gap? • Is there a demonstrable information gap? • Does the information gap pose significant dangers to consumers? • Can you show that other entities are providing information to consumers that is wrong or incomplete? • Does your information direct consumers (and producers) toward activities that benefit others? Away from actions that harm others?

24. Does your program address an information gap? • Do you inform people about the costs their actions impose on others? • Are you providing information to a population that does not have access to private information sources? • Does your program make information available in a way that participants will use it and act on it?

25. 2. Public sector intervention can promote fairness and justice What: The provision of a good or service to address a crucial concern about fairness can justify public funding- “Certain goods and services should be available to everyone at some minimal level, regardless of their ability-to-pay” Extension program examples: Expanded Food & Nutrition Education Program

26. Does your program address fairness or justice? • Is it available only to those who cannot purchase the good or service on the private market? • Do you collect a fee from those who can pay? • Is there broad agreement in society that this good should be provided to those who cannot pay?

27. 3. Public sector intervention can be justified by market failure: when private sector production is inadequate Four types! • Consumers create public benefits • Producers create public benefits • Consumers create public costs • Producers create public costs

28. Consumers or Producers create public benefits What: The consumption (use) of a good or service benefits someone who is not directly involved in the transaction. Result: The consumer fails to fully consider the public benefit, and consumes less of the good than society desires (or producer creates less than society desires). Extension program examples: Shoreline management, woodlot management, youth development, leadership, community visioning

29. ‘Public costs’ of consumption and production– a mirror case to ‘public benefits’ What: The use or production of a good or service confers costs on someone other those directly involved in the transaction. Result: The consumer or producer fails to fully consider the public cost, and consumes more of the good than society desires. Examples: obesity, toxic waste, bankruptcy, residential development, nutrient or stormwater management

30. Does your program address market failure? • Does the producer or consumer fail to consider the benefits to others? • Does the producer or consumer fail to fully consider the costs to others? • Does one person’s participation in your program benefit people who do not participate in—and have not paid for—your program?

31. Does your program address market failure? • Does your delivering the program benefit people who do not participate in—and have not paid for—the program? • What would be the free market outcome in the absence of your program?

32. Quick Exercise:What public value characteristics do different Conservation programs have?

33. Implications for Your Programs

34. How does your program generate public value? • Does your program narrow an information gap? • Does your program address a crucial concern about fairness? • Does one person’s participation in your program benefit people who do not participate in—and have not paid for—your program? • Does your delivering the program benefit people who do not participate in—and have not paid for—the program? • What would be the free market outcome in the absence of your program?

35. Maximize the public value bang for buck by substantiating our claims Participants in programs that have specific characteristics… have been shown to change their behavior in specific ways… that directly benefit the participants. that have been shown to lead to specific outcomes… that generate public benefits.

36. Example: Substantiating our claims have been shown to increase their leadership and social skills… Participants in a youth development & camping program which increases life skills, decreases use of drugs & alcohol, & reduces teen delinquency which have been shown to improve self esteem & self-motivation, and increase overall involvement in school and community… which helps them become productive members of society, improves the workforce, and reduces juvenile crime rates

37. Example: Substantiating our claims have been shown to increase their grades, classroom participation, health & fitness… Participants in a youth development & camping program … which benefits the participants. which have been shown to improve self esteem & self-motivation for learning throughout their academic career,… which improves the workforce, and reduces juvenile crime rates during after school hours Southwest Region, 4/07

38. Example: Substantiating our claims have been shown to increase their leadership and social skills… Participants in a 21st CCL after- school program… which benefits the participants. which have been shown to improve self esteem & self-motivation for learning throughout their academic career,… which improves the workforce, and reduces juvenile crime rates during after school hours Southwest Region, 4/07

39. Example: Substantiating our claims have been shown to increase their grades, classroom participation, health & fitness… Participants in a 21st CCL after- school program… which have been shown to improve self esteem & self-motivation, and increase overall involvement in school and community… which benefits the participants. which improves the workforce, and reduces juvenile crime rates during after school hours Southwest Region, 4/07

40. Example: Substantiating our claims have been shown to increase their grades, classroom participation, health & fitness… Participants in a 21st CCL after- school program… which increases life skills, decreases use of drugs & alcohol, & reduces teen delinquency which helps them become productive members of society, improves the workforce, and reduces juvenile crime rates which have been shown to improve self esteem & self-motivation for learning throughout their academic career,… Southwest Region, 4/07

41. Evaluation Program outputs: Activities—What we do Participation—Who we reach Short-term and medium-term outcomes and impacts Private benefits Long-term outcomes and impacts Public benefits Research

42. Quick Exercise:Create a Public Value Statement for a Program

43. So What Does All this Mean? • Conservation affects multiple values – not just $$$ • Fairness is often an important element • When describing value, consider both ‘participants’ and the ‘public’