Valuing Coastal Natural Capital in a Bioeconomic Framework

The wetlands of the Gulf Coast region of the United States are under pressure from relative sea level rise and subsidence pressures that threaten to alter fishery breeding grounds and increase expected damage from stochastic storm events, among other issues. Barrier islands, marshes, and swamps are thus forms of natural capital that serve both an intermediate role in supporting fishery stocks, as well as a final demand role in providing direct protection to infrastructure. In order to make good policy choices related to land loss, the values associated with these interacting stocks must be estimated. We extend the numerical approach of Fenichel and Abbott (2014) to illustrate the valuation both fish and wetlands stocks, allowing for the recovery of both final demand and intermediate service values, taking into account the scarcity value of each resource. We also present examples of policies which, when implemented, will change the subsequent valuation of each resource. JEL Codes: C6, D6, H41, Q2, Q3, Q57