Bio-based and Applied Economics 4(3): 235-259, 2015 DOI: 10.13128/BAE-16368 Full Research Article The evaluation of Ecosystem Services production: an application in the Province of Ferrara PARTHENA CHATZINIKOLAOU1,*, DAVIDE VIAGGI1, MERI RAGGI2 1 Department of Agricultural Sciences, University of Bologna, Italy 2 Department of Statistical Sciences, University of Bologna, Italy Date of submission: June 30th, 2015, accepted November 4th, 2015 Abstract. This paper presents an evaluation of the provision of Ecosystem Services (ES). The analysis is based on the design of a framework suitable to be translated into a multi-criteria evaluation process, followed by empirical testing. It focuses on the dif- ferent categories of ES and applies a set of non-overlapping indicators available from existing statistical sources. The framework is applied in a traditional cultural land- scape, the Province of Ferrara, situated in the Emilia-Romagna region of Italy. To develop an applicable framework, we have chosen a set of ES indicators from the Mil- lennium Ecosystem Assessment. According to the results and based on the indicators used in each category, the provision of cultural and provisioning services is high in all of the municipalities, while there is greater diversity in the provision of regulat- ing and supporting services. A key challenge in our analysis was related to the lack of information on the actual provision of ES at the municipality level, which led to a significant use of proxy indicators. Use of improved datasets, explicit consideration of policy scenarios and accounting for local priorities about ES provision have been identified as the most relevant avenues for future research in this area. Keywords. Ecosystem Services, evaluation, indicators, multi-criteria analysis, classi- fication JEL Codes. Q57, C38 1. Introduction The ecosystem concept describes the interrelationships between living organisms and the non-living environment. “An ecosystem is a dynamic complex of plant, animal, and microorganism communities and the non-living environment interacting as a functional unit” (MEA, 2005). There is a full range of ecosystems, from natural forests, to ecosystems managed and modified by humans, such as agricultural land. Ecosystems provide a vari- ety of benefits to people that are divided into market and non-market ecosystem goods or ecosystem services (ES) and classified in multiple ways. * Corresponding author: [email protected] ISSN 2280-6180 (print) © Firenze University Press ISSN 2280-6172 (online) www.fupress.com/bae 236 P. Chatzinikolaou, D. Viaggi, M. Raggi The Millennium Ecosystem Assessment Framework (MEA, 2003) identified four cat- egories of ES: (1) provisioning services, such as food and water; (2) regulating services, such as flood and disease control; (3) supporting services, such as nutrient cycling; and (4) cultural services, such as spiritual, recreational, and cultural benefits. Following the Economics of Ecosystems and Biodiversity (TEEB, 2010a), ES are the direct and indirect contributions of ecosystems to human well-beings and are also categorized into four types: provisioning, regulating, habitat and cultural services. A new classification of ES is cur- rently under development at the international level by the Common International Classifi- cation of Ecosystem Services (CICES, 2013). According to CICES, there are three types of services: provisioning, regulation (maintenance), and cultural services. The concept of ES is being integrated into current biodiversity policies at the global and European levels (EC, 2009; Perrings et al., 2011). The EU has adopted an ambitious strategy to halt the loss of biodiversity and ES by 2020 (EC, 2010b, 2011). There are 6 main targets, and 20 actions to help Europe reach its goal. Target 2 focuses on maintain- ing and enhancing ES and restoring degraded ecosystems by incorporating green infra- structure into spatial planning. Improved ways and methods for ES quantification, mapping and assessment are need- ed to investigate the number and quality of ES produced by individual ecosystems and to increase the ability to feed such knowledge into policy design (TEEB, 2010b). While provisioning ES can often be directly quantified thanks to the availability of primary data, for other ecosystem services the collection of such information is often impossible (Maes et al., 2015). Thus, for most regulating, supporting, and cultural services, research- ers must rely on proxies for their quantification. As a result, altogether, data on quantifi- able ES remain limited and only a small number of indicators are being used for those that cannot be measured directly (Feld et al., 2010, 2009; Layke et al., 2012). Reviews of indicators used for ES are now available from the literature and contribute to developing reliable indicators for modelling, as well as for bridging current data gaps (Cowling et al., 2008; Egoh et al., 2012)few studies are embedded in a social process designed to ensure effective management of ecosystem services. Most research has focused only on biophysi- cal and valuation assessments of putative services. As a mission-oriented discipline, eco- system service research should be user-inspired and user-useful, which will require that researchers respond to stakeholder needs from the outset and collaborate with them in strategy development and implementation. Here we provide a pragmatic operational mod- el for achieving the safeguarding of ecosystem services. The model comprises three phas- es: assessment, planning, and management. Outcomes of social, biophysical, and valuation assessments are used to identify opportunities and constraints for implementation. The latter then are transformed into user-friendly products to identify, with stakeholders, stra- tegic objectives for implementation (the planning phase. Several studies have assessed changes in land use and their connection with the provi- sion of ES (Carreño et al., 2012; Fontana et al., 2013; Silvert, 2000). In many cases, their output includes environmental and land use information that are connected to landscape features, although few yield a direct assessment of changes in ES provision (Burkhard et al., 2012; Swetnam et al., 2011). According to de Groot et al. (2010), ES approaches and ES valuation efforts have changed the terms of discussion on nature conservation, natural resource management, and other areas of public policy. These efforts have strengthened The evaluation of Ecosystem Services production 237 both public and private sector development strategies and improved environmental out- comes (de Groot, 2006; de Groot et al., 2002). The multidimensional logic of ES seems highly consistent with approaches based on Multi-Criteria Decision Analysis (MCDA). MCDA is a general framework for support- ing complex decision-making situations with multiple and often conflicting objectives. Regarding ES evaluation, MCDA methods have been applied as decision support systems that integrate economic and noneconomic values (Newton et al., 2012), used as approach- es for cost-benefit analysis (Wegner and Pascual, 2011), or as a methodological framework for addressing value dimensions related to ES (Mendoza and Prabhu, 2003). Oikonomou et al. (2011) proposed a conceptual framework that combines ecosystem function analysis, multi-criteria evaluation and social research methodologies for introducing an ecosystem function-based planning and management approach. Ananda and Herath (2009) provided a review of research contributions on forest management and planning. The objective of this paper is to evaluate the provision of ecosystem services focusing on the different categories of ES and applying a set of non-overlapping indicators availa- ble from secondary data sources. The approach used is based on the outranking method Preference Ranking Organisation Methods for Enrichment Evaluations (PROMETHEE). To evaluate the provision of ecosystem services, we used a traditional cultural landscape, the Province of Ferrara, situated in the Emilia-Romagna region and a set of ES from the Millennium Ecosystem Assessment Framework as criteria for the evaluation. The area con- sists of 26 municipalities, comprising the urban centre of Ferrara and adjoining agricultural lands within the ancient and vast Po River Delta. The area is characterised by historical- cultural locations, the surrounding landscape and protected areas of natural importance. In the present study, along with the application of PROMETHEE II, a comparison and ranking of the 26 municipalities of the province is performed, based on the selected ES indicators. Different studies have used ranking approaches as a tool to evaluate ES. At times those tools are used as part of a larger ES assessment process that can involve simul- taneously identifying ES and drivers of change, as well as ranking the most important ser- vices (López-Marrero and Hermansen-Báez, 2011; Shelton, 2001). The model assumes that the criteria are equally important, i.e. they did not use any weighing approach to reflect the relative preferences of decision makers. The structure of this paper is as follows: the following section describes the PRO- METHEE multi-criteria analysis framework; in the third section (Application), the case study and the selected ES indicators are introduced. In the fourth section, we present the results of the application of the PROMETHEE method for the evaluation of the provision of the ES in the Province of Ferrara. In the discussion sections, the key