Humankind benefits in a multitude of ways from ecosystems. Collectively, these benefits are known as ecosystem services. Ecosystem services are regularly involved in the provisioning of clean drinking water and the decomposition of wastes. While scientists and environmentalists have discussed ecosystem services implicitly for decades, the ecosystem services concept itself was popularized by the Millennium Ecosystem Assessment (MA) in the early 2000s. This grouped ecosystem services into four broad categories: provisioning, such as the production of food and water; regulating, such as the control of climate and disease; supporting, such as nutrient cycles and crop pollination; and cultural, such as spiritual and recreational benefits. To help inform decision-makers, many ecosystem services are being assigned economic values.
- 1 Brief history
- 2 Examples
- 3 Ecology
- 4 Economics
- 5 Management and policy
- 6 Ecosystem services and business
- 7 Ecosystem services decisions
- 8 See also
- 9 References
- 10 Further reading
- 11 External links
The simple notion of human dependence on Earth’s ecosystems reaches to the start of our species’ existence, when we benefited from the products of nature to nourish our bodies and for shelter from harsh climates. Recognition of how ecosystems could provide more complex services to mankind date back to at least Plato (c. 400 BC) who understood that deforestation could lead to soil erosion and the drying of springs. However, modern ideas of ecosystem services probably began with Marsh in 1864  when he challenged the idea that Earth’s natural resources are unbounded by pointing out changes in soil fertility in the Mediterranean. However, his observations and cautions passed largely unnoticed at the time and it was not until the late 1940s that society’s attention was again brought to the matter. During this era, three key authors – Osborn, Vogt, and Leopold  – awakened and promoted recognition of human dependence on the environment with the idea of ‘natural capital’. In 1956, Sears  drew attention to the critical role of the ecosystem in processing wastes and recycling nutrients. An environmental science textbook  called attention to “the most subtle and dangerous threat to man’s existence... the potential destruction, by man’s own activities, of those ecological systems upon which the very existence of the human species depends”. The term ‘environmental services’ was finally introduced in a report of the Study of Critical Environmental Problems, which listed services including insect pollination, fisheries, climate regulation and flood control. In following years, variations of the term were used, but eventually ‘ecosystem services’ became the standard in scientific literature.
Modern expansions of the ecosystem services concept include socio-economic and conservation objectives, which are discussed below. For a more complete history of the concepts and terminology of ecosystem services, see Daily (1997).
The Millennium Ecosystem Assessment (MA) report 2005 defines Ecosystem services as benefits people obtain from ecosystems and distinguishes four categories of ecosystem services, where the so-called supporting services are regarded as the basis for the services of the other three categories. The following lists represent the definition and samples of each according to the MA:
"Products obtained from ecosystems" 
- • food (including seafood and game), crops, wild foods, and spices
- • raw materials (including lumber, skins, fuel wood, organic matter, fodder, and fertilizer)
- • genetic resources (including crop improvement genes, and health care)
- • water
- • minerals (including diatomite)
- • medicinal resources (including drugs, pharmaceuticals, chemical models, and test and assay organisms)
- • energy (hydropower, biomass fuels)
- • ornamental resources (including fashion, handicraft, jewelry, pets, worship, decoration and souvenirs like furs, feathers, ivory, orchids, butterflies, aquarium fish, shells, etc.)
"Benefits obtained from the regulation of ecosystem processes" 
"Nonmaterial benefits people obtain from ecosystems through spiritual enrichment, cognitive development, reflection, recreation, and aesthetic experiences" 
- • cultural (including use of nature as motif in books, film, painting, folklore, national symbols, architect, advertising, etc.)
- • spiritual and historical (including use of nature for religious or heritage value or natural)
- • recreational experiences (including ecotourism, outdoor sports, and recreation)
- • science and education (including use of natural systems for school excursions, and scientific discovery)
- There are various working definitions of ecosystems services in the literature. The most recent revision by TEEB to synthesize work in this field and prevent double counting in ecosystem services audits, has revised the MA definition to remove "Supporting Services" and replace it on the one hand with "Habitat Services" and on the other hand with "ecosystem functions" that "are defined as a subset of the interactions between ecosystem structure and processes that underpin the capacity of an ecosystem to provide goods and services".
- There is discussion as to how the concept of cultural ecosystem services can be operationalized. A good review of approaches in landscape aesthetics, cultural heritage, outdoor recreation, and spiritual significance to define and assess cultural values of our environment so that they fit into the ecosystem services approach is given by Daniel et al. who vote for models that explicitly link ecological structures and functions with cultural values and benefits.
- There also is a fundamental critique of the concept of cultural ecosystem services that builds on three arguments:
- Pivotal cultural values attaching to the natural/cultivated environment rely on an area’s unique character that cannot be addressed by methods that use universal scientific parameters to determine ecological structures and functions.
- If a natural/cultivated environment has symbolic meanings and cultural values the object of these values are not ecosystems but shaped lifeworldly phenomena like mountains, lakes, forests, and, mainly, symbolic landscapes.
- Those cultural values do result not from properties produced by ecosystems but are the product of a specific way of seeing within the given cultural framework of symbolic experience.
To understand the relationships between humans and natural ecosystems through the services derived from them, consider the following cases:
- • In New York City, where the quality of drinking water had fallen below standards required by the U.S. Environmental Protection Agency (EPA), authorities opted to restore the polluted Catskill Watershed that had previously provided the city with the ecosystem service of water purification. Once the input of sewage and pesticides to the watershed area was reduced, natural abiotic processes such as soil absorption and filtration of chemicals, together with biotic recycling via root systems and soil microorganisms, water quality improved to levels that met government standards. The cost of this investment in natural capital was estimated between $1-1.5 billion, which contrasted dramatically with the estimated $6-8 billion cost of constructing a water filtration plant plus the $300 million annual running costs.
- • Pollination of crops by bees is required for 15-30% of U.S. food production; most large-scale farmers import non-native honey bees to provide this service. One study  reports that in California’s agricultural region, it was found that wild bees alone could provide partial or complete pollination services or enhance the services provided by honey bees through behavioral interactions. However, intensified agricultural practices can quickly erode pollination services through the loss of species and those remaining are unable to compensate for the difference. The results of this study also indicate that the proportion of chaparral and oak-woodland habitat available for wild bees within 1-2 km of a farm can strongly stabilize and enhance the provision of pollination services, thereby providing a potential insurance policy for farmers of this region.
- • In watersheds of the Yangtze River (China), spatial models for water flow through different forest habitats were created to determine potential contributions for hydroelectric power in the region. By quantifying the relative value of ecological parameters (vegetation-soil-slope complexes), researchers were able to estimate the annual economic benefit of maintaining forests in the watershed for power services to be 2.2 times that if it were harvested once for timber.
- • In the 1980s, mineral water company Vittel (now a brand of Nestlé Waters) faced a critical problem. Nitrates and pesticides were entering the company’s springs in northeastern France. Local farmers had intensified agricultural practices and cleared native vegetation that previously had filtered water before it seeped into the aquifer used by Vittel. This contamination threatened the company’s right to use the “natural mineral water” label under French law. In response to this business risk, Vittel developed an incentive package for farmers to improve their agricultural practices and consequently reduce water pollution that had affected Vittel's product. For example, Vittel provided subsidies and free technical assistance to farmers in exchange for farmers' agreement to enhance pasture management, reforest catchments, and reduce the use of agrochemicals. This is an example of a Payment for ecosystem services program.
Understanding of ecosystem services requires a strong foundation in ecology, which describes the underlying principles and interactions of organisms and the environment. Since the scales at which these entities interact can vary from microbes to landscapes, milliseconds to millions of years, one of the greatest remaining challenges is the descriptive characterization of energy and material flow between them. For example, the area of a forest floor, the detritus upon it, the microorganisms in the soil and characteristics of the soil itself will all contribute to the abilities of that forest for providing ecosystem services like carbon sequestration, water purification, and erosion prevention to other areas within the watershed. Note that it is often possible for multiple services to be bundled together and when benefits of targeted objectives are secured, there may also be ancillary benefits – the same forest may provide habitat for other organisms as well as human recreation, which are also ecosystem services.
The complexity of Earth’s ecosystems poses a challenge for scientists as they try to understand how relationships are interwoven among organisms, processes and their surroundings. As it relates to human ecology, a suggested research agenda  for the study of ecosystem services includes the following steps:
- identification of ecosystem service providers (ESPs) – species or populations that provide specific ecosystem services – and characterization of their functional roles and relationships;
- determination of community structure aspects that influence how ESPs function in their natural landscape, such as compensatory responses that stabilize function and non-random extinction sequences which can erode it;
- assessment of key environmental (abiotic) factors influencing the provision of services;
- measurement of the spatial and temporal scales ESPs and their services operate on.
Recently, a technique has been developed to improve and standardize the evaluation of ESP functionality by quantifying the relative importance of different species in terms of their efficiency and abundance. Such parameters provide indications of how species respond to changes in the environment (i.e. predators, resource availability, climate) and are useful for identifying species that are disproportionately important at providing ecosystem services. However, a critical drawback is that the technique does not account for the effects of interactions, which are often both complex and fundamental in maintaining an ecosystem and can involve species that are not readily detected as a priority. Even so, estimating the functional structure of an ecosystem and combining it with information about individual species traits can help us understand the resilience of an ecosystem amidst environmental change.
Many ecologists also believe that the provision of ecosystem services can be stabilized with biodiversity. Increasing biodiversity also benefits the variety of ecosystem services available to society. Understanding the relationship between biodiversity and an ecosystem's stability is essential to the management of natural resources and their services.
The concept of ecological redundancy is sometimes referred to as functional compensation and assumes that more than one species performs a given role within an ecosystem. More specifically, it is characterized by a particular species increasing its efficiency at providing a service when conditions are stressed in order to maintain aggregate stability in the ecosystem. However, such increased dependence on a compensating species places additional stress on the ecosystem and often enhances its susceptibility to subsequent disturbance. The redundancy hypothesis can be summarized as "species redundancy enhances ecosystem resilience".
Another idea uses the analogy of rivets in an airplane wing to compare the exponential effect the loss of each species will have on the function of an ecosystem; this is sometimes referred to as rivet popping. If only one species disappears, the loss of the ecosystem's efficiency as a whole is relatively small; however if several species are lost, the system essentially collapses as an airplane wing would, were it to lose too many rivets. The hypothesis assumes that species are relatively specialized in their roles and that their ability to compensate for one another is less than in the redundancy hypothesis. As a result, the loss of any species is critical to the performance of the ecosystem. The key difference is the rate at which the loss of species affects total ecosystem function.
A third explanation, known as the portfolio effect, compares biodiversity to stock holdings, where diversification minimizes the volatility of the investment, or in this case, the risk in stability of ecosystem services. This is related to the idea of response diversity where a suite of species will exhibit differential responses to a given environmental perturbation and therefore when considered together, they create a stabilizing function that preserves the integrity of a service.
Several experiments have tested these hypotheses in both the field and the lab. In ECOTRON, a laboratory in the UK where many of the biotic and abiotic factors of nature can be simulated, studies have focused on the effects of earthworms and symbiotic bacteria on plant roots. These laboratory experiments seem to favor the rivet hypothesis. However, a study on grasslands at Cedar Creek Reserve in Minnesota seems to support the redundancy hypothesis, as have many other field studies.
There are questions regarding the environmental and economic values of ecosystem services. Some people may be unaware of the environment in general and humanity's interrelatedness with the natural environment, which may cause misconceptions. Although environmental awareness is rapidly improving in our contemporary world, ecosystem capital and its flow are still poorly understood, threats continue to impose, and we suffer from the so-called ‘tragedy of the commons’. Many efforts to inform decision-makers of current versus future costs and benefits now involve organizing and translating scientific knowledge to economics, which articulate the consequences of our choices in comparable units of impact on human well-being. An especially challenging aspect of this process is that interpreting ecological information collected from one spatial-temporal scale does not necessarily mean it can be applied at another; understanding the dynamics of ecological processes relative to ecosystem services is essential in aiding economic decisions. Weighting factors such as a service’s irreplaceability or bundled services can also allocate economic value such that goal attainment becomes more efficient.
The economic valuation of ecosystem services also involves social communication and information, areas that remain particularly challenging and are the focus of many researchers. In general, the idea is that although individuals make decisions for any variety of reasons, trends reveal the aggregative preferences of a society, from which the economic value of services can be inferred and assigned. The six major methods for valuing ecosystem services in monetary terms are:
- Avoided cost
- Services allow society to avoid costs that would have been incurred in the absence of those services (e.g. waste treatment by wetland habitats avoids health costs)
- Replacement cost
- Services could be replaced with man-made systems (e.g. restoration of the Catskill Watershed cost less than the construction of a water purification plant)
- Factor income
- Services provide for the enhancement of incomes (e.g. improved water quality increases the commercial take of a fishery and improves the income of fishers)
- Travel cost
- Service demand may require travel, whose costs can reflect the implied value of the service (e.g. value of ecotourism experience is at least what a visitor is willing to pay to get there)
- Hedonic pricing
- Service demand may be reflected in the prices people will pay for associated goods (e.g. coastal housing prices exceed that of inland homes)
- Contingent valuation
- Service demand may be elicited by posing hypothetical scenarios that involve some valuation of alternatives (e.g. visitors willing to pay for increased access to national parks)
A peer-reviewed study published in 1997 estimated the value of the world's ecosystem services and natural capital to be between US$16–54 trillion per year, with an average of US$33 trillion per year. However, Salles (2011) indicates 'The total value of biodiversity is infinite, so having debate about what is the total value of nature is actually pointless because we can't live without it'
Management and policy
Although monetary pricing continues with respect to the valuation of ecosystem services, the challenges in policy implementation and management are significant and multitudinous. The administration of common pool resources is a subject of extensive academic pursuit. From defining the problems to finding solutions that can be applied in practical and sustainable ways, there is much to overcome. Considering options must balance present and future human needs, and decision-makers must frequently work from valid but incomplete information. Existing legal policies are often considered insufficient since they typically pertain to human health-based standards that are mismatched with necessary means to protect ecosystem health and services. To improve the information available, one suggestion has involved the implementation of an Ecosystem Services Framework (ESF), which integrates the biophysical and socio-economic dimensions of protecting the environment and is designed to guide institutions through multidisciplinary information and jargon, helping to direct strategic choices.
Novel and expedient methods are needed to deal with managing Earth’s ecosystem services. Local to regional collective management efforts might be considered appropriate for services like crop pollination or resources like water. Another approach that has become increasingly popular over the last decade is the marketing of ecosystem services protection. Payment and trading of services is an emerging worldwide small-scale solution where one can acquire credits for activities such as sponsoring the protection of carbon sequestration sources or the restoration of ecosystem service providers. In some cases, banks for handling such credits have been established and conservation companies have even gone public on stock exchanges, defining an evermore parallel link with economic endeavors and opportunities for tying into social perceptions. However, crucial for implementation are clearly defined land rights, which is often lacking in many developing countries. In particular, many forest-rich developing countries suffering deforestation experience conflict between different forest stakeholders. In addition, concerns for such global transactions include inconsistent compensation for services or resources sacrificed elsewhere and misconceived warrants for irresponsible use. Another approach has been focused on protecting ecosystem service ‘hotspots’. Recognition that the conservation of many ecosystem services aligns with more traditional conservation goals (i.e. biodiversity) has led to the suggested merging of objectives for maximizing their mutual success. This may be particularly strategic when employing networks that permit the flow of services across landscapes, and might also facilitate securing the financial means to protect services through a diversification of investors.
For example, in recent years there has been interest in the valuation of ecosystem services provided by shellfish production and restoration. A keystone species, low in the food chain, bivalve shellfish such as oysters support a complex community of species by performing a number of functions essential to the diverse array of species that surround them. There is also increasing recognition that some shellfish species may impact or control many ecological processes; so much so that they are included on the list of “ecosystem engineers”—organisms that physically, biologically or chemically modify the environment around them in ways that influence the health of other organisms. Many of the ecological functions and processes performed or affected by shellfish contribute to human well-being by providing a stream of valuable ecosystem services over time by filtering out particulate materials and potentially mitigating water quality issues by controlling excess nutrients in the water.
Ecosystem services and business
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Ecosystem services degradation can pose a number of risks to corporate performance as well as provide business opportunities through ecosystem restoration and enhancement. Risks and opportunities include:
- Risks such as higher costs for freshwater due to scarcity or lower output for hydroelectric facilities due to siltation
- Opportunities such as increasing water-use efficiency or building an on-site wetland to circumvent the need for new water treatment infrastructure
- Regulatory and legal
- Risks such as new fines, government regulations, or lawsuits from local communities that lose ecosystem services due to corporate activities
- Opportunities such as engaging governments to develop policies and incentives to protect or restore ecosystems that provide services a company needs
- Risks such as retail companies being targeted by nongovernmental organization campaigns for purchasing wood or paper from sensitive forests
- Opportunities such as implementing and communicating sustainable purchasing, operating, or investment practices in order to differentiate corporate brands.
- Market and product
- Risks such as customers switching to other suppliers that offer products with lower ecosystem impacts or governments implementing new sustainable procurement policies
- Opportunities such as launching new products and services that reduce customer impacts on ecosystems or participating in emerging markets for carbon sequestration and watershed protection other products
- Risks such as banks implementing more rigorous lending requirements for corporate loans
- Opportunities such as banks offering more favorable loan terms or investors taking positions in companies supplying products and services that improve resource use efficiency or restore degraded ecosystems
Many companies are not fully aware of the extent of their dependence and impact on ecosystems and the possible ramifications. Likewise, environmental management systems and environmental due diligence tools are more suited to handle “traditional” issues of pollution and natural resource consumption. Most focus on environmental impacts, not dependence. Several newly developed tools and methodologies can help the private sector value and assess ecosystem services. These include Our Ecosystem, the Corporate Ecosystem Services Review (ESR), Artificial Intelligence for Ecosystem Services (ARIES), the Natural Value Initiative (NVI) and InVEST (Integrated Valuation of Ecosystem Services & Tradeoffs) 
Ecosystem services decisions
Ecosystem services decisions require making complex choices at the intersection of ecology, technology, society and the economy. The process of making ecosystem services decisions must consider the interaction of many types of information, honor all stakeholder viewpoints and measure the impacts on all four parts of the intersection. Further complicating the process, these decisions are often spatial, always multi-objective, and based on uncertain data, models, and estimates.
More than most any other type of decision, ecosystem services rely on and affect many different classes of stakeholders including regulatory agencies, proposal proponents, decision makers, residents, NGOs, etc. Often it is the combination of the best science combined with the stakeholder values, estimates and opinions that drive the process. Science alone cannot usually drive ecosystem services decisions as the scientific data and analytical models are uncertain.
Various efforts have been made integrate the stakeholder needs, in a spatial environment while taking into account the uncertainty. One analytical study modeled the stakeholders as agents  to support water resource management decisions in the Middle Rio Grande basin of New Mexico. This study focused on modeling the stakeholder inputs across a spatial decision, but ignored uncertainty. Another study used Monte Carlo methods  to exercise econometric models of landowner decisions in a study of the effects of land-use change. Here the stakeholder inputs were modeled as random effects to reflect the uncertainty. A third study used a Bayesian decision support system  to both model the uncertainty in the scientific information Bayes Nets and to assist collecting and fusing the input from stakeholders. This study was specifically tuned to siting wave energy devices off the Oregon Coast, but presents a general method for managing uncertain spatial science and stakeholder information in a decision making environment.
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- Millennium Ecosystem Assessment
- Earth Economics
- Gund Institute for Ecological Economics
- The Economics of Ecosystems and Biodiversity
- COHAB Initiative on Health and Biodiversity - Ecosystems and Human Well-being
- The ARIES Consortium
- Ecosystem Marketplace
- Plan Vivo: an operational model for Payments for Ecosystem Services
- Ecosystem services at Green Facts
- Water Evaluation And Planning (WEAP) system for modeling impacts on aquatic ecosystem services
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- GecoServ - Gulf of Mexico Ecosystem Services Valuation Database