This paper Demystifying Economic Valuation covers the main issues, questions and principles surrounding economic valuation and is designed as an overview for those new to economic valuation. The paper brings together input from 120 volunteers from the economic valuation community. The editors are Ece Ozdemiroglu and Rosie Hails from the Valuing Nature Programme Coordination Team.
The paper covers the following topics:
- Why economic valuation?
- What is economic valuation?
- How do we estimate economic value?
- Whose values count?
- How do we use economic values in decision making?
- But economic values vary! And so they should!
- How to communicate economic value evidence.
Financing forest-related enterprises in ways that reduce both deforestation and poverty is critical to climate action and sustainable development. The Climate Investment Funds (CIF) ‘Evaluation and Learning Partnership on Financing Forest-Related Enterprises’ (ELPFFRE) is looking at ways of improving access to and leverage of finance from the private sector. This International Institute for Environment and Development (IIED) briefing presents early findings from the evalutation. These findings suggest that on the spectrum from micro livelihood investments to large debt or equity investments lies a challenging weak or ‘missing middle’, with a potentially very high multiplier effect for CIF. Emerging questions to tackle this ‘missing middle’ should now be focused on scaling up for greater efficiency, the best way to improve forest enterprise through business incubation and ways to reduce the risk of investing in these businesses.