The Inclusion of Ecosystem Service in Land Valuation and Impact on Cadastral Land Value – a Case Study

DOI 10.7160/aol.2025.170110
No 1/2025, March
pp. 133-148

Slaboch, J. and Malý, M. (2025) "The Inclusion of Ecosystem Service in Land Valuation and Impact on Cadastral Land Value – a Case Study ", AGRIS on-line Papers in Economics and Informatics, Vol. 17, No. 1, pp. 133-148. ISSN 1804-1930. DOI 10.7160/aol.2025.170110.

Abstract

In the Czech Republic, a system of evaluated soil-ecological units (ESEU) is used for soil valuation, where the price is determined on the basis of production potential. In practice, the production potential of soil is also very important for spatial planning because it is used to determine the protection class of agricultural land with regard to the possibility of designating it for non-productive purposes. This paper focuses on the application of an econometric model to determine the effect on soil value in selected cadastral areas when the effect of the non-productive function of soil in the form of retention is taken into account. This is effectively an ecosystem service calculation, as only the production function is included in the ESEU price in the Czech Republic. For the purposes of the paper, three alternative scenarios are chosen in which the production price includes the price for the non-production function in the form of retention, in the amounts of 5%, 10% and 20%. The results show that even a 5% inclusion of soil retention has a significant impact on its price and, more precisely, on its value. The difference between the original value and the shadow value with the greatest effect of water retention at the 20% level is approximately CZK 12.3 million for the Ivančice site and approximately CZK 20.6 million for the Lysá nad Labem site, which indicates the importance of changing the current government methodology. The higher increase for the Ivančice site is due to the higher proportion of more productive ESEU and, at the same time, the higher retention capacity of the main soil units (MSU), which is absolutely necessary for the valuation of agricultural land in the main production areas of the Czech Republic. The results confirm that in these most valuable areas, the increased share of ecosystem components would lead to the greatest increase in the price of agricultural land, which can be considered as an adequate and meaningful result, if only in the context of comparing agricultural land prices between EU Member States. The water retention capacity of the soil is a qualitative indicator of the non-productive function of the soil and is increasingly supported as such.

Keywords

Soil, ecosystems services, hydrological characteristics, econometric modelling, SUR model, land valuation.

References

  1. Almansa, C., Calatrava, J. and Martinez-Paz, J. M. (2012) "Extending the framework of the economic evaluation of erosion control actions in Mediterranean basins", Land Use Policy, Vol. 29, No. 2, pp. 294-308. ISSN 0264-8377. DOI 10.1016/j.landusepol.2011.06.013.
  2. Asiama, K. O., Bennett, R. M. and Zevenbergen, J. A. (2017) "Land Consolidation on Ghana’s Rural Customary Lands: Drawing from The Dutch, Lithuanian and Rwandan Experiences", Journal Rural Studies, Vol. 56, pp. 87-99. E-ISSN 1873-1392, ISSN 0743-0167. DOI 10.1016/j.jrurstud.2017.09.007.
  3. Atkinson, G., Bateman, I. and Mourato, S. (2012) "Recent advances in the valuation of ecosystem services and biodiversity", Oxford Review of Economic Policy, Vol. 28, No. 1, pp. 22-47. E-ISSN 1460-2121, ISSN 0266-903X. DOI 10.1093/oxrep/grs007.
  4. Bai, Y., Ochuodho, T. O. and Yang, J. (2019) "Impact of land use and climate change on water-related ecosystem services in Kentucky, USA", Ecological Indicators, Vol. 102, pp. 51-64. E-ISSN 1872-7034. DOI 10.1016/j.ecolind.2019.01.079.
  5. Baveye, P. C., Baveye, J. and Gowdy, J. (2016) "Soil "Ecosystem" Services and Natural Capital: Critical Appraisal of Research on Uncertain Ground", Frontiers in Environmental Science, Vol. 4, 41 p. E-ISSN 2296-665X. DOI 10.3389/fenvs.2016.00041.
  6. Bouma, J. (2015) "Reaching out from the soil-box in pursuit of soil security", Soil Science and Plant Nutrition, Vol. 61, No. 4, pp. 556-565. ISSN 0038-0768. DOI 10.1080/00380768.2015.1045403.
  7. Cay, T., Ayten, T. and Iscan, F. (2010) "Effects of Different Land Reallocation Models on the Success of Land Consolidation Projects: Social and Economic Approaches", Land Use Policy, Vol. 27, pp. 262-269. ISSN 0264-8377. DOI 10.1016/j.landusepol.2009.03.001.
  8. Cejudo, E., Bravo-Mendoza, M., Gomez-Ramirez, J. J. and Acosta-González, G. (2024) "Water retention and soil organic carbon storage in tropical karst wetlands in Quintana Roo, Mexico", Wetlands Ecology and Management, Vol. 32, No. 4, pp. 539-552. ISSN 0923-4861. DOI 10.1007/s11273-024-09990-3.
  9. Chang, Y. and Yoshino, K. (2017) "Theory of Willingness to Sell to Valuate Ecosystem Services in the Contingent Valuation Method", Journal of Environmental Informatics, Vol. 29, No. 1, pp. 53-60. E-ISSN 2663-6867. DOI 10.3808/jei.201700362.
  10. Choumert, J. and Phélinas, P. (2015) "Determinants of Agricultural Land Values in Argentina", Ecological Economics, Vol. 110, pp. 134-140. E-ISSN 1873-6106, ISSN 0921-8009. DOI 10.1016/j.ecolecon.2014.12.024.
  11. Costanza, R., d'Arge, R., de Groot, R., Farber, S., Grasso, M., Hannon, B., Limburg, K., Naeem, S., O'Neill, R. V., Paruelo, J., Raskin, R. G., Sutton, P. and van den Belt, M. (1997) "The value of the world’s ecosystem services and natural capital", Nature, Vol. 387, p. 6630, pp. 253-260. E-ISSN 1476-4687, ISSN 0028-0836. DOI 10.1038/387253a0.
  12. Costanza, R., de Groot, R., Braat, L., Kubiszewski, I., Fioramonti, L., Paul Sutton, P., Farber, S. and Grasso, M. (2017) "Twenty years of ecosystem services: How far have we come and how far do we still need to go? ", Ecosystem Services, Vol. 28, pp. 1-16. ISSN 2212-0416. DOI 10.1016/j.ecoser.2017.09.008.
  13. Damayanti, I., Bambang, A. N. and Soeprobowati, T. R. (2018) "Extended benefit cost analysis as an instrument of economic valuated in Petungkriyono forest ecosystem services", In: Warsito, B., Putro, S. P. and Khumaeni, A. (eds) 7th International Seminar on New Paradigm and Innovation on Natural Science and Its Application (ISNPINSA), Semarang, Indonesia. IoP Publishing Ltd (Journal of Physics Conference Series), p. 012034. ISBN 9781510864047. DOI 10.1088/1742-6596/1025/1/012034.
  14. Deng, O., Li, Y. and Feng, Z. (2011) "Retrieval of Soil Water Retention and Its Economic Valuation in Danjiangkou Reservoir and Upper Area", In: Luo, J. (ed.) International Conference on Ecological Protection of Lakes-Wetlands-Watershed and Application of 3S Technology (EPLWW3S 2011), Sham Shui Po: Int Industrial Electronic Center, pp. 193-198. [Online]. Available: https://www.webofscience.com/wos/woscc/full-record/WOS:000391516000045 [Accessed: July 12, 2024].
  15. Deniz, T. and Ok, K. (2016) "Valuation analysis in erosion control activities", Forestist, Official Journal of Istambul University - Cerraphaşa, Faculty of Forestry, Vol, 66, No. 1, pp. 139-158. E-ISSN 2602-4039. DOI 10.17099/jffiu.18338.
  16. Dushin, A., Ignatyeva, M. N., Yurak, V. V. and Ivanov, A. N. (2020) "Economic Evaluation of Environmental Impact of Mining: Ecosystem Approach", Eurasian Mining, Vol. 2020, No. 1, pp. 30-36. ISSN 2072-0823. DOI 10.17580/em.2020.01.06.
  17. Gamal, G., Samak, M. and Shahba, M. (2021) "The Possible Impacts of Different Global Warming Levels on Major Crops in Egypt", Atmosphere, Vol. 12, No. 12, p. 1589. ISSN 2073-4433. DOI 10.3390/atmos12121589.
  18. Hui, J., Lin, E.-D., Wheeler, T., Challinor, A. and Jiang, S. (2013) "Climate Change Modelling and Its Roles to Chinese Crops Yield", Journal of Integrative Agriculture, Vol. 12, No. 5, pp. 892-902. ISSN 2095-3119. DOI 10.1016/S2095-3119(13)60307-X.
  19. Iliopoulos, V. G. and Damigos, D. (2024) "Groundwater Ecosystem Services: Redefining and Operationalizing the Concept", Resources-Basel, Vol. 13, No. 1, 13 p. ISSN 2079-9276. DOI 10.3390/resources13010013.
  20. Jürgenson, E. (2016) "Land Reform, Land Fragmentation and Perspectives for Future Land Consolidation in Estonia", Land Use Policy, Vol. 57, pp. 34-43. ISSN 0264-8377. DOI 10.1016/j.landusepol.2016.04.030.
  21. Kruczkowska, B., Solon, J. and Wolski, J. (2017) "Mapping Ecosystem Services - a New Regional-Scale Approach", Geographia Polonica, Vol. 90, No. 4, pp. 503-520. ISSN 0016-7282. DOI 10.7163/GPol.0114.
  22. Liu, Y. (2020) "The willingness to pay for ecosystem services on the Tibetan Plateau of China", Geography and Sustainability, Vol. 1, No. 2, pp. 141-151. ISSN 2666-6839. DOI 10.1016/j.geosus.2020.06.001.
  23. Lungarska, A. and Chakir, R. (2024) "Projections of climate change impacts on ecosystem services and the role of land use adaptation in France", Environmental and Sustainability Indicators, Vol. 22, p. 100369. ISSN 2665-9727. DOI 10.1016/j.indic.2024.100369.
  24. Maes, J., Liquete, C., Teller, A., Erhard, M., Paracchini, M. L., Barredo, J. I., Grizzetti, B., Cardoso, A., Somma, F., Petersen, J.-E., Meiner, A., Gelabert, E. R., Zal, N., Kristensen, P., Bastrup-Birk, A., Biala, K., Piroddi, C., Egoh, B., Patrick Degeorges, P., Fiorina, C., Santos-Martín, F., Naruševičius, V., Verboven, J., Henrique M. Pereira, H. M., Bengtsson, J., Gocheva, K., Cristina Marta-Pedroso, C., Snäll, T., Estreguil, C., San-Miguel-Ayanz, J., Pérez-Soba, M., Grêt-Regamey, A., Lillebø, A. I., Malak, D. A., Condé, S., Moen, J., Czúcz, B., Drakou, E. G., Zulian, G. and Lavalle, C. (2016) "An indicator framework for assessing ecosystem services in support of the EU Biodiversity Strategy to 2020", Ecosystem Services, Vol. 17, pp. 14-23. ISSN 2212-0416. DOI 10.1016/j.ecoser.2015.10.023.
  25. Mikhailova, E. A., Post, C. J., Schlautman, M. A., Post, G. C. and Zurquani, H. A. (2020) "The Business Side of Ecosystem Services of Soil Systems", Earth, Vol. 1, No. 1, pp. 15-34. E-ISSN 2673-4834. DOI 10.3390/earth1010002.
  26. Niroula, G. S. and Thapa, G. B. (2005) "Impacts and Causes of Land Fragmentation, and Lessons Learned from Land Consolidation in South Asia", Land Use Policy, Vol. 22, No. 4, pp. 358-372. ISSN 0264-8377. DOI 10.1016/j.landusepol.2004.10.001.
  27. Orlandi, F., Rojo, J., Picornell, A., Oteros, J., Pérez-Badia, R. and Fornaciari, M. (2020) "Impact of Climate Change on Olive Crop Production in Italy", Atmosphere, Vol. 11, No. 6, p. 595. ISSN 2073-4433. DOI 10.3390/atmos11060595.
  28. Paris, M. Grant, M. C., Civit, B., Córica, L. and Mercado, M. V. (2023) "Economic valuation of the CO2 emissions from land use change", Economia Sociedad y Territorio, Vol. 23, No. 73, pp. 901-929. ISSN 1405-8421. DOI 10.22136/est20231883.
  29. Pereira, D., Mendes, C. and Dias, E. (2022) "The potential of peatlands in global climate change mitigation: a case study of Terceira and Flores Islands (Azores, Portugal) hydrologic services", SN Applied Sciences, Vol. 4, No. 6, p. 184 . E-ISSN 2523-3971. DOI 10.1007/s42452-022-05066-0.
  30. Pérez-Soba, M., Petit, S., Jones, L., Bertrand, N., Briquel, V., Omodei-Zorini, L., Contini, C., Helming, K., Farrington, J. H., Mossello, M. T., Washer, D., Kienast, F. and de Groot, R. (2008) "Land Use Functions—A Multifunctionality Approach to Assess the Impact of Land Use Changes on Land Use Sustainability. In: Helming, K., Pérez-Soba, M., Tabbush, P. (Eds.) "Sustainability Impact Assessment of Land Use Changes", Springer: Berlin/Heidelberg, Germany, pp. 375-404. ISBN 978-3-540-78647-4. DOI 10.1007/978-3-540-78648-1_19.
  31. Plaas, E., Meyer-Wolfart, F., Banse, M., Bergmann, H., Faber, J., Potthoff, M., Runge, T., Schrader, S. and Taylor, A. (2019) "Towards valuation of biodiversity in agricultural soils: A case for earthworms", Ecological Economics, Vol. 159, No. C., pp. 291-300. ISSN 0921-8009. DOI 10.1016/j.ecolecon.2019.02.003.
  32. Salzman, J., Bennett, G., Carroll, N., Goldstein, A. and Jenkins, M. (2018) "The global status and trends of Payments for Ecosystem Services", Nature Sustainability, Vol. 1, No. 3, pp. 136-144. E-ISSN 2398-9629. DOI 10.1038/s41893-018-0033-0.
  33. Sannigrahi, S., Chakraborti, S., Banerjee, A., Rahmat, S., Bhatt, S., Jha, S., Singh, L. K., Paul, S. K. and Sen, S. (2020) "Ecosystem service valuation of a natural reserve region for sustainable management of natural resources", Environmental and Sustainability Indicators, Vol. 5, p. 100014. ISSN 2665-9727. DOI 10.1016/j.indic.2019.100014.
  34. Seppelt, R., Dormann, C. F., Eppink, F. V., Lautenbach, S. and Schmidt, S. (2011) "A quantitative review of ecosystem service studies: approaches, shortcomings and the road ahead", Journal of Applied Ecology, Vol. 48, No. 3, pp. 630-636. E-ISSN 1365-2664, ISSN 0021-8901. DOI 10.1111/j.1365-2664.2010.01952.x.
  35. Slaboch, J. and Malý, M. (2023) "Land Valuation Systems in Relation to Water Retention", Agronomy, Vol. 13, No. 12, p. 2978. E-ISSN 2073-4395. DOI 10.3390/agronomy13122978.
  36. Slizhe, M., Safranov, T., Berlinsky, N. and Hadri, Y. E. (2023) "Impact of climate change factor on the resource (providing) ecosystem services of the Lower Danube wetlands", Visnyk of V. N. Karazin Kharkiv National University,-Series Geology Geography Ecology, Vol. 59, pp. 307-319. E-ISSN 2411-3913, ISSN 2410-7360. DOI 10.26565/2410-7360-2023-59-23.
  37. Sourokou, R., Vodouhe, F. G., Tovignan, S. and Yabi, J. A. (2023) "Economic valuation of forest degradation through direct users’ willingness to pay in Benin (West Africa) ", Trees, Forests and People, Vol.14, p. 100459. E-ISSN 2666-7193. DOI 10.1016/j.tfp.2023.100459.
  38. Soylu, M. E. and Bras, R. L. (2024) "Quantifying and valuing irrigation in energy and water limited agroecosystems", Journal of Hydrology X, Vol. 22, p. 100169. E-ISSN 2589-9155. DOI 10.1016/j.hydroa.2023.100169.
  39. Tesfaye, K., Gbegbelegbe, S., Cairns, J. E., ShiferaW, B., Prasanna, B. M., Sonder, K., Boote, K., Makumbi, D. and Robertson, R. (2015) "Maize systems under climate change in sub- Saharan Africa Potential impacts on production and food security", International Journal of Climate Change Strategies and Management, Vol. 7, No. 3, pp. 247-271. E-ISSN 1756-8706. DOI 10.1108/IJCCSM-01-2014-0005.
  40. Tezcan, A., Büyüktaş, K. and Akkaya Aslan, Ş. T. (2020) "A Multi-Criteria Model for Land Valuation in the Land Consolidation, Land Use Policy, Vol. 95, p. 104572. ISSN 0264-8377. DOI 10.1016/j.landusepol.2020.104572.
  41. Thao, T., Harrison, B. P., Gao, S., Ryals, R., Dahlquist-Willard, R., Diaz, G. C. and Ghezzehei, T. A. (2023) "The effects of different biochar-dairy manure co-composts on soil moisture and nutrients retention, greenhouse gas emissions, and tomato productivity: Observations from a soil column experiment", Agrosystems Geosciences & Environment, Vol. 6, No. 3, p. e20408. E-ISSN 2639-6696. DOI 10.1002/agg2.20408.
  42. Tinch, R., Beaumont, N., Sunderland, T., Ozdemiroglu, E., Barton, D., Bowe, C., Börger, T., Burges, P., Cooper, C. N., Faccioli, M., Failler, P., Gkolemi, I., Kumar, R., Longo, A., McVittie, A., Morris, J., Park, J., Ravenscroft, N., Schaafsma, M., Vause, J. and Ziv. G. (2019) "Economic valuation of ecosystem goods and services: a review for decision makers", Journal of Environmental Economics and Policy, Vol. 8, No. 4, pp. 359-378. E-ISSN 2160-6552. DOI 10.1080/21606544.2019.1623083.
  43. Wu, J., Huang, Y. and Jiang, W. (2022) "Spatial matching and value transfer assessment of ecosystem services supply and demand in urban agglomerations: A case study of the Guangdong-Hong Kong-Macao Greater Bay area in China", Journal of Cleaner Production, Vol. 375, p. 134081. ISSN 0959-6526. DOI 10.1016/j.jclepro.2022.134081.
  44. Yan, X. and Li, L. (2023) "Spatiotemporal characteristics and influencing factors of ecosystem services in Central Asia", Journal of Arid Land, Vol. 15, No. 1, pp. 1-19. ISSN 0959-6526. DOI 10.1007/s40333-022-0074-0.
  45. Yang, Y., Wu, J., Zhao, S., Mao, Y., Zhang, J., Pan, X., He, F. and von der Ploeg, M. (2021) "Impact of long-term sub-soiling tillage on soil porosity and soil physical properties in the soil profile", Land Degradation & Development, Vol. 32, No. 10, pp. 2892-2905. E-ISSN 1099-145X. DOI 10.1002/ldr.3874.
  46. Zhang, L., Fang., C., Zhu, C., Gao, Q. (2022) "Ecosystem service trade-offs and identification of eco-optimal regions in urban agglomerations in arid regions of China", Journal of Cleaner Production, 373, p. 133823. ISSN 0959-6526. DOI 10.1016/j.jclepro.2022.133823.
  47. Zhang, Y., Qui, X., Yin, T., Liao, Z., Liu, B. and Liu, L. (2021) "The Impact of Global Warming on the Winter Wheat Production of China", Agronomy-Basel, Vol. 11, No. 9, p. 1845. E-ISSN 2073-4395. DOI 10.3390/agronomy11091845.
  48. Zhao, R., Gabriel, J. L., Martin, J. A. R., Feng, Z. and Wu, K. (2022) "Understanding trade-offs and synergies among soil functions to support decision-making for sustainable cultivated land use", Frontiers in Environmental Science, Vol. 10, p. 1063907. ISSN 2296-665X. DOI 10.3389/fenvs.2022.1063907.
  49. Zhu, P., Burney, J., Chang, J., Jin, Z., Mueller, N. D., Xin, Q., Xu, J., Yu, L., Makowski, D. and Ciais, P. (2022) "Warming reduces global agricultural production by decreasing cropping frequency and yields", Nature Climate Change, Vol.12, pp. 1016-1023. ISSN 1758-678X. DOI 10.1038/s41558-022-01492-5.

Full paper

  Full paper (.pdf, 1.42 MB).