Testing the effect of ecosystem service and land classification on global values of forested watershed ecosystem services

Forested watersheds provide a variety of ecosystem services. Their economic valuation has increased significantly over the past decades, but the literature is fragmented and heterogenous and little has been done to systematically analyse estimated values. This paper presents a global meta-analysis of the economic values of forested watershed services (FWS). We address two key methodological issues in the literature: the impact of FWS classification on value estimates and sensitivity to scale based on the stock of FWS. The latter is measured as the forested watershed area size compared to common practices to measure overall area size including other land cover and use. In the former case, we compare the detailed Common International Classification of Ecosystem Services (CICES) with more simple and informal classifications found in the literature. We show that both the explanatory and predictive power of the estimated meta-regression models increase as we include more details about the valued FWS and use more accurate estimations of the stock of FWS. Findings are cross-validated with the existing forest hydrology literature. The study highlights the economic significance of maintaining forest cover in watershed areas and the need for more harmonised and accurate reporting of the flow and stock of FWS in the non-market valuation literature. • Meta-analysis explores variation in global values of forested watershed services. • Detailed ecosystem service classification improves model explanatory and predictive power. • Forest area size better explains value variation than total site area. • Hydropower-related FWS yield the highest economic value estimates. • PES schemes yield lower forested watershed service values than valuation approaches.