Exploring the economic value of trees’ social and environmental benefits

It reviews a large body of work that has helped to reveal the full value of woodlands to people, business and the economy. Work is ongoing to fill remaining gaps in the economic evidence base, including the role of woodlands in alleviating flood risk, removing air pollution and improving physical and mental health.

The report and an accompanying research note, Valuing the social and environmental contribution of woodlands and trees in England, Scotland and Wales, reports that although economists, planners and policy makers increasingly recognise the economic importance of trees and woodland, many of their social and environmental benefits are wholly or partly unvalued in markets and associated calculations of GDP.

Dr Pat Snowdon from the Forestry Commission, who commissioned the report, said: “This report provides a clear explanation of the many ways in which woodlands underpin our economy, and where future priorities for research lie. We hope that it makes clear why natural assets, such as woodlands, are so important to the economy and why they need to be managed sustainably.”

Dr Amy Binner from the University of Exeter, who led the study, said: “Some of the many goods and services provided by trees and woodland, such as timber, are traded in markets and are valued according to their prices. They contribute to established economic measures of value, such as gross domestic product (GDP).

“However, many of the social and environmental benefits are wholly or partly unvalued in markets and associated GDP calculations.

“This doesn’t mean that these benefits have no value. In fact, there is strong evidence to show that nature plays a major role in generating economic activity and well-being, and awareness is increasing of the environmental and economic risks of undervaluing this role.

This report and note are based on a review by the University of Exeter which evaluated existing knowledge of work done to value the social and environmental contributions of British trees and woodlands. They bring together different but related economic terms and concepts in a single framework for understanding how trees and woodlands contribute to economic well-being, and set out some guiding principles which distinguish this area of study.

The report also provides a background and explanation of ‘natural capital’ accounting, which has become important to forestry. Tables are used to categorise and summarise the evidence base of the social and environmental contributions, including consideration of decision support tools and a separate assessment for urban trees. Further tables summarise priorities for future research to fill gaps in understanding and to develop more-advanced techniques and models.