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date: 21 October 2018

Summary and Keywords

Economics plays an important role not only in the management of national parks in developed countries, but also in demonstrating the contribution of these areas to societal well-being. The beneficial effect of park tourism on jobs and economic activity in communities near these protected areas has at times been a factor in their establishment. These economic impacts continue to be highlighted as a way to demonstrate the benefit and return on investment of national parks to local economies. However, the economic values supported by national parks extend far beyond local economic benefits. Parks provide unique recreation opportunities, health benefits, preservation of wildlife and habitat, and a wide range of ecosystem services that the public assigns an economic value to. In addition, value is derived from the existence of national parks and their preservation for future generations. These nonmarket benefits can be difficult to quantify, but they are essential for understanding and communicating the economic importance of parks. Economic methods used to estimate these values have been refined and tested for nearly seven decades, and they have come a long way in helping to elucidate the extent of the nonmarket benefits of protected areas.

In many developed countries, national parks have regulations and policies that outline a framework for the consideration of economic values in decision-making contexts. For instance, large oil spills in the United States, such as the Exxon Valdez spill of 1989 and the Deepwater Horizon spill of 2010, highlighted the need to better understand public values for affected park resources, leading to the extensive use of nonmarket values in natural resource damage assessments. Of course, rules and enforcement issues vary widely across countries, and the potential for economics to inform the day-to-day operations of national parks is much broader than what is currently outlined in such policies. While economics is only one piece of the puzzle in managing national parks, it provides a valuable tool for evaluating resource tradeoffs and for incorporating public preferences into the decision-making process, leading to greater transparency and assurance that national parks are managed for the benefit of society. Understanding the full extent of the economic benefits supported by national parks helps to further the mission of these protected areas in developed countries.

Keywords: national parks, total economic value, consumer surplus, benefit-cost analysis, economic benefits, economic impacts, damage assessment

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