Ecosystem services play a crucial role in sustaining human well-being and economic viability. People benefit substantially from the delivery of ecosystem services, for which substitutes usually are costly or unavailable. Climate change will substantially alter or eliminate certain ecosystem services in the future. To better understand the consequences of climate change and to develop effective means of adapting to them, it is critical that we improve our understanding of the links between climate, ecosystem service production, and the economy. This study examines the impact of climate change on the terrestrial distribution and the subsequent production and value of two key ecosystem services in California: (1) carbon sequestration and (2) natural (i.e. nonirrigated) forage production for livestock. Under various scenarios of future climate change we predict that the provision and value of ecosystem services decline under most, but not all, future greenhouse gas trajectories. The predicted changes would result in decreases in the economic output for the state and global economy and illustrate some of the hidden costs of climate change. Since existing information is insufficient to conduct impact analysis across most ecosystem services, a comprehensive research program focused on estimating the impacts of climate change on ecosystem services will be important for understanding, mitigating and adapting to future losses in ecosystem service production and the economic value they provide.

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