The Worth of Nature

This study estimates the impact of ecosystem services (ES) on rural land values in southern Chile using a hedonic pricing model. The methodology integrates over 80,000 georeferenced rustic plot transactions (1999–2023) with expert-scored data on 32 ES, including 21 regulating and 11 cultural services, mapped onto a hexagonal tessellation of structural land types. Spatial proximity to ES sources was weighted using inverse-distance functions. The results show significant and diverse effects of ES on land prices, revealing both positive (e.g., waste filtering) and negative (e.g., pollination) valuation impacts. These findings reveal critical gaps in Chile’s current tax appraisal system, which overlooks the contribution of natural capital to the formation of land value. The study emphasizes the need to modernize property taxation by incorporating the various contributions of ecosystem services to land. This approach enhances redistributive potential and strengthens territorial equity, particularly in ecologically sensitive, rapidly subdividing rural areas.