Part of the puzzle surrounding biodiversity loss lies in an incomplete understanding of how humans value the functions and services that flow from biodiversity conservation projects. This paper takes a closer look at the links between the conservation of biodiversity and the livelihoods of rural people who live on the fringes of the parks and protected areas. We revisit some of the key aspects of ecosystem valuation—purpose, methodology, and policy design and implementation—because the links between biodiversity conservation, ecosystem services, and human welfare are obscured by considerable smoke and mirrors. Using a biodiversity conservation project (Ruteng Park) on Flores Island in Indonesia as a case study, we build a concrete empirical example of ecosystem valuation. This conservation project has resulted in spatially patchy watershed protection that allows us to identify and estimate the impacts of watershed services on human health (diarrhea prevalence) in the buffer zone of the park. We conclude by offering a plan of research to improve the design of conservation interventions for protecting biodiversity and providing ecosystem services. These recommendations include developing more conceptual knowledge on the linkages between biodiversity and ecosystem services; scaling up valuation efforts of underappreciated services such as health; shifting focus from valuing services individually to valuing multiple benefits from the same area; and conducting conservation policy experiments to identify causal outcomes (including defensible estimates of ecosystem values).
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