Service providing units, existence values and the valuation of endangered species: A methodological test

Non-market valuation approaches for estimating the social value of biodiversity and individual species need to enhance their policy relevance. The concept of service-providing unit (SPU) may help achieve this objective by promoting the systematic quantification of the key components of nature that provide services for human wellbeing. The present paper is the first application of the SPU concept in stated preference surveys. The object of valuation is the highly endangered Mediterranean monk seal (Monachus monachus). A split-sample is used testing the hypotheses that the SPU framework would: 1) minimize the part of non-use values that is due to a 'warm glow' effect and therefore 2) encourage respondents in reallocating part of their total economic value towards use values. Our results indicate that the difference between the means of existence values in the two sub-samples is statistically insignificant: in both cases respondents attribute a significant percentage of their total economic value to existence value. On the other hand though, the non-use value component of WTP decreases in the sub-sample with SPU in relation to the sub-sample without it. We conclude that existence values in our sample are based on solid preferences related to the species since they persisted in both sub-samples.

► This is the first SPU application in non-market valuation. ► The object of valuation is the highly endangered Mediterranean monk seal. ► A split sample tests two hypotheses that SPU reduces warm glow effects and increases use values. ► We conclude positively on the second hypothesis. ► The first hypothesis remains under investigation.