Evaluating indicators of aquatic ecosystem health for valuation and policy analysis
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The Water Quality Ladder (WQL) and its derivatives are the primary metrics used by environmental economists to value surface water quality changes for policy analysis. Such metrics are convenient for valuation because they combine multiple chemical and physical measurements into a single metric that is benchmarked by suitability for specific use-values – e.g. boating, fishing, swimming, and drinking. People derive value from aquatic ecosystems via motivations other than uses such as those, however, so relying solely on the WQL for valuation may underestimate benefits from proposed policy. The purpose of this study is to identify a metric of aquatic biological integrity to complement the WQL on valuation surveys to estimate the non-use value of water quality improvements. We identify a set of candidates and evaluate them using four criteria for environmental quality indicators: measurability, interpretability, applicability, and comprehensiveness. Using the supporting documentation of the candidate indicators and extensive focus group research, we identify the ratio of observed taxonomic composition of the aquatic resource to the composition expected under reference conditions (O/E) as the most appropriate indicator to capture non-use value from aquatic biological integrity. The features of O/E that drive this judgement are its national availability and reporting consistency, the ability of the general public to accurately interpret changes in its value, and its cognitive separability with human use values. We intend to use O/E and the WQL on a forthcoming valuation survey to analyze the properties of use and non-use benefits from surface water quality improvements.