Do ecological–economic tradeoffs triggered by budget allocations for forest carbon sequestration change under different market conditions?

We analyze how the optimal spatial budget distribution for protecting ecosystem services under two extreme market conditions results in different ecological–economic tradeoffs for balance between conservation and sustainable development. As a case study, we develop an empirical framework for the optimal spatial budget distribution given the objectives of maximizing forest carbon storage and maximizing total value added in the Central and Southern Appalachian Region. We consistently find concave efficient frontiers between carbon storage and total value added and differences in ecological–economic tradeoffs under two extreme market conditions in 2006 and 2011 for intra- and inter-generational sustainability. The former confirms previous findings of a concave tradeoff relationship, while the latter new finding suggests that balancing weights between the two objectives with preferences of decision makers can be effectively done depending on the market conditions. For example, if a conservation agency considers increasing the weight on either maximizing total value-added or maximizing forest carbon storage, the decision makers should consider the sacrifice of the other objective required by the optimal decision, which changes across market conditions. We also find that a conservation agency may want to consider the negative consequences on equity between rural and urban areas of increasing the weight on maximizing total value-added, regardless of the market condition.