Benefit Cost Analysis and Multi-Criteria Decision Approaches for Assessing Ecological Services: An Economic Perspective

Climate change and rapid urbanization have diminished ecosystem service provision, posing serious threats to human welfare and the global environment. Ecosystem-based adaptation measures, such as Green Infrastructure (GI), are recognized as effective solutions, but a lack of comprehensive data on benefits and costs has constrained their growth. Economic valuation of ecosystem services provided by Green Infrastructure, aimed at maximizing social welfare, is crucial. Multi-criteria Decision Analysis (MCDA) is a suitable method to capture the multi-dimensional nature of ecosystem services. However, it may not fully address the three goals of ecosystem services valuation: efficiency, equity, and sustainability. This paper explores different approaches from the perspective of welfare economics to achieve these goals, providing insights into how Green Infrastructure can be integrated into decision-making processes for optimal social welfare.