This paper attempts to ‘demystify’ the notion of
Total Economic Value (TEV) of environmental goods and services, and sets out
the reasons for which markets fail to reflect this value, which results in
distorted prices of environmental goods and services of land. Distorted prices,
in turn, threaten to entail numerous adverse effects on present and future
generations. The paper outlines the OSLO’s innovative and practical methodology
for calculating TEV of an ecosystem, and the most commonly used techniques for
valuing different ecosystem services are presented.