What’s the Economic Value of a Tree?


It’s hard or almost impossible to estimate a tree’s economic value especially if it’s not used for logging or fruit production. It’s also hard to estimate the costs and benefits of having a tree in your garden. As a result, trees are often taken for granted and they’re only being noticed if they’re absent (realising the value of something that’s lost already).

What’s the economic value of a tree

The ecological value of trees is already clear because they’re known to take in carbon dioxide, store and sequester carbon, give off oxygen, reduce land salinisation (source pdf study), remove air pollutants and help in flood control (especially in upland areas).

In contrast, the economic value of trees is uncertain and often depends on people’s perceptions. For instance, there are people who prefer having a clear land or that the land is fully used for a new commercial structure. After all, the new structure will have a clear projection on cash flow and return on investment. There’s a corresponding dollar amount whether the structure gets built or not. On the other hand, the dollar amount of a tree is hard or almost impossible to estimate.

Fortunately, many economic benefits can be easily realised and appreciated. For example, a tree may help improve an asset’s aesthetic and property value (this depends on the home buyer though). Trees also provide a natural canopy and cooling effect not just in individual properties but also on the entire urban area. Dozens of trees can help remove tons of carbon dioxide from the air (thereby making the air fresher). In addition, with the natural canopy and cooling the residential or commercial structure can also save on air conditioning costs.

Notice that trees are regularly playing those roles in forests. Trees are habitats and food sources for various animals, fungi and even other trees and plants. Trees in forests also provide a natural canopy and effective temperature regulation in forests and for other species. They also heavily influence the kind of ecosystem below because of how trees help regulate the amount of sunlight reaching the other plants and the ground.

In urban and other residential and commercial areas, trees also influence the kind of environment and community the place will have. In areas with healthy trees, they are said to be friendly and liveable (in contrast to dry and concrete places which tell something about despair and abandonment).

Still, a tree’s economic value is hard to measure. But the benefits are always clear because we can immediately feel or imagine the experience of not having them. With that in mind, we’ll think twice before having a tree cut down.