Types of Value

In an exhaustive survey across diverse domains—from economics and business to art, luxury goods, philosophy, social customs, real estate, investment, finance, and insurance—we identified over 300 types of value. The comprehensive list is available in the accompanying RealValue workbook, "Types of Value" sheet.

Given our focus on optimizing the holistic use and valuation of real assets, we've concentrated on the following frameworks:

• Real asset valuation

• Real estate appraisal

• Business valuation

• Ecosystem services valuation

Central to our assessment are the practices common among institutional investors in real assets, the global commercial and investment real estate markets, as well as emerging systems in environmental economic accounting and ecosystem services valuation, including natural asset valuation and biodiversity credits.

For our specific context, we frame value through three key concepts: cost, price, and value. These may overlap or diverge depending on the user's perspective. While value is most frequently expressed in quantitative terms like dollars, it also manifests in various qualitative forms and is commonly classified as instrumental value, intrinsic value, and relational value.

Cost, Price, & Value

Generally:

• Cost refers to the actual expense incurred to build or acquire something and is closely related to price.

• Price is essentially the market value of an asset, representing the most probable selling price in a competitive, open market.

• Value can span from human-centered market value (instrumental value) to the invaluable or infinite (intrinsic value), as well as relational value, which describes an asset's worth in relation to other entities, be they living or non-living, across both space and time.

Depending on the valuation method, user perspective, and ultimate goal of the valuation, other specific types of value are inherent in the broader categories of cost, price, and value. These include but are not limited to:

• use and non-use value

• market and non-market value

• total economic value (TEV)

• replacement cost

• insurable value

• investment value

• net asset value (NAV).

Two Primary Types of Value

In our quest for the "RealValue" of Natural Capital, we recognize nature's intrinsic value as priceless. However, we also acknowledge the need to express this value in a common language that everyone understands, dollars, to avoid further degrading the biodiversity that comprises our biosphere. Two types of value are .

Our analysis reveals two primary types of value that can easily be expressed in dollars and are particularly relevant to real assets and ecosystem services: anthropocentric value and public goods value.

• Anthropocentric Value encompass widely recognized forms of value, including a property's market value and the income it generates. Anthropocentric Value is also referred to as financial value.

• Public Goods Value, historically considered positive externalities, refer to the common benefits nature provides at no charge. Ecosystem services serve as the most appropriate classification for these values. "Public Goods" are generally those from which society at large benefits and which may not be privately owned or are hard to exclude people from enjoying. These have both intrinsic and instrumental values that often extend beyond the boundaries of a "property". Public Goods Value is also referred to as economic value.

The following "Valuation Methods" section elaborates on how these values are quantified, focusing on real assets and ecosystem services.