**1. Introduction**

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146 Agroecology

Although the primary function of agricultural lands is to supply commodity outputs such as food, fibre and other raw materials for industrial use, these lands are also a source of many outputs that are not commodities. The non-commodity products are jointly produced and exhibit public goods1 characteristics. Although more commonly known as externalities of agricultural production, together with the primary production functions are referred to as 'multifunctionality' [1]. Now there is a wide recognition of the services provided by various types of ecosystems [2].

Multifunctionality is important to recognize in the context of human well-being, as it depends on goods and services provided by nature in association with other forms of capital resources. These other capitals include: human capital2 , social capital3 , and manufactured capital4 (Figure 1). In fact, humanity has always depended on the services provided by the biosphere and its

<sup>4</sup> Manufactured capital is the infrastructure that is needed to produce various products in the economic system.

© 2015 The Author(s). Licensee InTech. This chapter is distributed under the terms of the Creative Commons Attribution License (http://creativecommons.org/licenses/by/3.0), which permits unrestricted use, distribution, and eproduction in any medium, provided the original work is properly cited.

<sup>1</sup> A public good has the characteristic that if supplied to one individual it can be provided to others at no extra cost. Furthermore, no individual can be excluded from the use of that good.

<sup>2</sup> Refers to investments made in human resources in order to improve productivity.

<sup>3</sup> Social capital is the expected collective or economic benefits derived from the preferential treatment and cooperation between individuals and groups, typically through social networks.

ecosystems – natural capital [3]. In order to achieve sustainability, all types of capital are required, although natural capital and economic capital are complementary, and cannot be substituted for each other. Particularly, some of the natural capital cannot even be substituted for any other type of capital (human and manufactured capitals). Furthermore, in some cases, substituting some natural capital may be economically impractical.

An ecosystem service is some attribute of an ecosystem which provides value to humankind [4]. These services are usually related to some attribute of the ecosystem but there is not necessarily a one-to-one correspondence of functions to service. Ecosystems as a provider of goods and services have a value to humankind. These values measure the importance of ecosystem services to members of the society.

The Millennium Ecosystem Assessment [3] has suggested four major types of ecosystem services: provisioning services, cultural services, regulating services, and supporting services that are related to well-being of humans (Figure 2). Provisioning services are the products that the people obtain from the ecosystem. Goods such as food, fibre, water, genetic resources, and others are typical examples. Regulating services include regulation of air quality, climate, water quality, pollination, biological control of diseases, among others. These services are related to productivity of human and non-human systems, and thus have a value. Cultural services result in non-monetary benefits to humans through recreation, aesthetics, and related services. Supporting services are those that are needed for the generation of all the above three types of ecosystem services. Their impact on people is not direct but indirect through these three services.

**New Figure 1**

**New Figure 2 Figure 1.** Types of capital resources relevant to human well-being

**ECOSYSTEM SERVICES DIRECT AND INDIRECT DRIVERS OF CHANGE IN NATURAL CAPITAL PROVISIONING SERVICES** - Food - Fresh Water - Fibre - Fuelwood - Genetic Resources **CULTURAL SERVICES** - Recreation - Educational - Tourism - Aesthetics **REGULATING SERVICES** - Climate Regulation - Water Quality - Disease Regulation **SUPPORTING SERVICES -** Soil formation - Nutrient cycling - Primary production Common awareness of concerning trends in climate change and other negative externalities of human activities has recently attracted some attention towards the importance of ecosystem goods and services. Communities and governments have begun to recognize the services that are offered by nature [3]. In response to this need of societies, many researchers and research foundations have started assessing and valuating ecosystems goods and services. Reviewing such studies may shed a light on our way to recognizing the essential goods and services of grasslands in Canada and provide a better understanding of values of these goods and services for society.

**DETERMINANTS OF HUMAN WELL-BEING**

2

**HUMAN**

**Human Capital**

> **Social Capital**

**WELL-BEING**

**New Figure 1**

**Manufactured Capital**

> **Natural Capital**

ecosystems – natural capital [3]. In order to achieve sustainability, all types of capital are required, although natural capital and economic capital are complementary, and cannot be substituted for each other. Particularly, some of the natural capital cannot even be substituted for any other type of capital (human and manufactured capitals). Furthermore, in some cases,

An ecosystem service is some attribute of an ecosystem which provides value to humankind [4]. These services are usually related to some attribute of the ecosystem but there is not necessarily a one-to-one correspondence of functions to service. Ecosystems as a provider of goods and services have a value to humankind. These values measure the importance of

The Millennium Ecosystem Assessment [3] has suggested four major types of ecosystem services: provisioning services, cultural services, regulating services, and supporting services that are related to well-being of humans (Figure 2). Provisioning services are the products that the people obtain from the ecosystem. Goods such as food, fibre, water, genetic resources, and others are typical examples. Regulating services include regulation of air quality, climate, water quality, pollination, biological control of diseases, among others. These services are related to productivity of human and non-human systems, and thus have a value. Cultural services result in non-monetary benefits to humans through recreation, aesthetics, and related services. Supporting services are those that are needed for the generation of all the above three types of ecosystem services. Their impact on people is not direct but indirect through these

**New Figure 1**

**New Figure 2**

Common awareness of concerning trends in climate change and other negative externalities of human activities has recently attracted some attention towards the importance of ecosystem goods and services. Communities and governments have begun to recognize the services that are offered by nature [3]. In response to this need of societies, many researchers and research foundations have started assessing and valuating ecosystems goods and services. Reviewing such studies may shed a light on our way to recognizing the essential goods and services of grasslands in Canada and provide a better understanding of values of these goods and services

**SERVICES** - Food - Fresh Water - Fibre - Fuelwood - Genetic Resources

**HUMAN WELL-BEING**

**DETERMINANTS OF HUMAN WELL-BEING**

**CULTURAL SERVICES** - Recreation - Educational - Tourism - Aesthetics

**ECOSYSTEM SERVICES**

**SUPPORTING SERVICES -** Soil formation - Nutrient cycling - Primary production **Human Capital**

> **Social Capital**

**REGULATING SERVICES** - Climate Regulation - Water Quality - Disease Regulation

2

substituting some natural capital may be economically impractical.

ecosystem services to members of the society.

**Manufactured Capital**

> **Natural Capital**

**Figure 1.** Types of capital resources relevant to human well-being

**DIRECT AND INDIRECT DRIVERS OF CHANGE** 

**IN NATURAL CAPITAL PROVISIONING**

three services.

148 Agroecology

for society.

**Figure 2.** Ecosystems services and ecological goods and services from natural capital (Adapted from [2])

Grasslands are an important part of the rural landscape and are defined as semi-arid areas dominated by herbaceous and shrub vegetation [5]. Worldwide, grasslands fall into three categories, namely, prairie, steppe, and savanna, and cover approximately 3,500 million hectares [6]. On the Canadian prairies, grasslands cover approximately 11 million hectares, extending across southern parts of Alberta, Saskatchewan, and Manitoba, and encompass five prairie eco-regions; Dry Mixed Grass, Mixed Grass, Foothills Fescue, Parkland Northern Fescue, and Tall Grass prairie [7]. Approximately 90% of the Canadian prairie grassland area is grazed by domestic livestock and wildlife [7].

Grasslands have long played a multifunctional role, as a source of feed for wild and domestic herbivores [8,9], and have provided a range of other goods and services (non-commodity goods) such as: management of water resources, carbon sequestration, nitrogen fixation, and recreation [8]. Grasslands are a sustainable source of producing high quality meat and milk [10] and are expected to play an increasingly important role in energy production. The use of perennial grass species, such as switchgrass for ethanol production, could reduce the use of fossil fuels (a positive move in the context of climate change) while also providing producers with an avenue for diversification [11]. Grasslands also play an important role in carbon sequestration. The substantial stocks of carbon sequestered in temperate grassland ecosystems are located largely below ground in the extensive root system of grasses [12, 13]. Perennial forages improve soil quality by reducing erosion and increasing nutrient content of the soil [14]. Grasslands breakdown plant litter and animal wastes and purify water, thus ensuring land and water sustainability and health for future generations [15]. The high plant species richness makes grasslands an ideal habitat for diverse animal populations [8]. Perennial grass cover is important for recreational activities, such as hunting and wildlife viewing [14]. Grasslands provide areas for species reproduction and refuge. For example, ducks need 40% of the landscape as grass in order to achieve nesting success [16]. Grassland flora and fauna 2

are an important genetic resource and provide material for animal and plant breeding and biotechnology [13]. Grasslands are also an important source of biochemical substances that have important medicinal uses [17]. Animal products, such as skins and shells, and flowers from grasslands are important ornamental resources [18]. Thus, the multifunctional role of grasslands provides an important argument for the protection of grasslands as either managed or natural ecosystems.

Ecosystem services through generating ecological goods and services have a value to society, as they contribute to human welfare, both directly and indirectly, and to economic viability through the sustainability of healthy ecosystems [19]. Most goods and services provided by grasslands are not paid for directly and are often overlooked in land-use decision-making processes, resulting in either over-exploitation or inefficient use of grasslands [9]. Establishing an economic value for grassland goods and services increases perception of the importance of grasslands and can lead to improvement in land use in terms of improved grassland manage‐ ment, conservation and protection [9]. Valuation of grasslands can also form the basis for grassland damage assessment and compensation systems [20]. One report on temperate grasslands [20] notes that, although the role of goods and services from temperate grasslands has long been identified as important, the quantitative valuation of such Goods services has not received much attention. A similar sentiment has been expressed through a survey of producers (farmers and ranchers), where recognition of grassland ecosystem services by producers was found to be low – only 25% had awareness of the term 'ecological goods and services' while another 22% indicated some familiarity [21]. To fill this void in past research, this study was undertaken to (a) provide a strategy for assessing the economic value of goods and services from grasslands, (b) identify variables that influence the value of grassland goods and services, and (c) identify gaps in knowledge which require more information to improve the valuation process.
