Compensation mechanism for damage from ecosystem services deterioration: constitutive characteristic

Abstract

A growing attention of researchers and politicians to the processes of formation and implementation of the environmental compensation mechanism is fixed in the last decade. Environmental compensation has been viewed as a national or regional regulatory mechanism that contributes to balancing the goal of environmental conservation with the goals of sustainable socio-economic development. The literature on the ecosystem service has developed the terminology of the eco-compensation mechanism. Still, they do not define its functional structure within its framework, in particular, a compensation mechanism for damage from the deterioration of ecosystem services. We characterised this crucial but relatively understudied component of the eco-compensation mechanism and suggested a general formula for determining the magnitude of compensatory payments for damages from degradation/destruction of ecosystem services, which will help to improve the implementation of compensatory payments in decision-making as well as drive green economic activity.