Hernandez, Marcello2019-04-092019-04-09b59286842http://hdl.handle.net/1885/159404While Costa Rica has been a world leader in ecosystem services research and policy, the value of natural capital and ecosystem services is still often ignored or underestimated. The overarching goal of this dissertation is to address this knowledge gap and to formulate economic incentives and institutions that can adequately incorporate ecosystem services. First, I summarize the state of the art of natural capital and ecosystem services. I describe concepts, how they have evolved in the last two decades, and the most appropriate methods for ecosystem services valuation. Second, I estimate the present and future value of ecosystem services in Latin America and the Caribbean, with a focus on Costa Rica. I estimate that the current ecosystem services value (ESV) of the 33 countries that make up this region to be $US15.3 trillion/year. Modelling four future scenarios, I estimated that there is a potential for ESV to decrease to $8 trillion/year (for the "Fortress World" scenario) or to increase to $19 trillion/year (for the "Great Transition" scenario), a difference of a 47% decrease or a 25% increase. Third, I explore the economic value of wetlands at a national level, estimating the value of ecosystem services of 7 Ramsar Sites. Our results show that the total economic value of ecosystem services from these Ramsar Sites is $3.2 billion/year for 2015, which represents 6% of the country's GDP. Fourth, I focus on the value of ecosystem services of mangroves in the Gulf of Nicoya. A hybrid approach was used, including traditional benefit transfer and expert modified benefit transfer for 11 ecosystem services, and primary studies for 3 ecosystem services (fisheries, climate regulation and coastal protection). Using traditional benefit transfer, the economic value of 11 ecosystem services was estimated at $812 million per year (median=$88 million/year), and the total mean value of the ecosystem services provided by the total extent of mangroves in Costa Rica at $1.5 billion per year (median=$160 million/year). Combining the values of the expert modified benefit transfer with the estimates from the primary studies, the mean total value of the ecosystem services was estimated at $408 million per year (median $86 million/year). Considering the median total value of ecosystem services from mangroves, this represents 0.16% of the GDP in Costa Rica in 2015. Finally, I propose a research and policy agenda to establish a payment for ecosystem services scheme in Costa Rica for marine and coastal ecosystems. I recommend a six-step approach to create this new PES scheme, called the Blue Fund: 1) Ecosystem assessment, 2) ecosystem services selection and valuation, 3) threats identification and prioritization, 4) creation of funding sources and investment, 5) implementation, and 6) evaluation and adaptation. I illustrate each step with a focus on mangroves and coral reefs.en-AU201910.25911/5d51492ad795e