16 December 2010

Ecosystem services

Here's the thought experiment: what is it worth to you, to avoid a world that's dark, dry and dead?

In The value of the world's ecosystem services and natural capital (Nature 1997, via JJ), Costanza et al. estimate the value of ecosystems services to be about double the world economy. Even ignoring all of the problems of GDP measurement (cutting down trees and shooting guns both add value to GDP), I'd say that this estimate is in the ballpark.

Great, so then what? First, make sure that you reflect the value of the ecosystem in cost-benefit analysis of human activity (e.g, draining a wetlands for housing development). Second, consider the value of investing in ecosystems over other human activities (e.g., a new play ground versus a clean beach).

In other words:
If ecosystem services were actually paid for, in terms of their value contribution to the global economy, the global price system would be very different from what it is today. The price of commodities using ecosystem services directly or indirectly would be much greater... As natural capital and ecosystem services become more stressed and more "scarce" in the future, we can only expect their value to increase. If significant, irreversible thresholds are passed for irreplaceable ecosystem services, their value may quickly jump to infinity.
Bottom Line: Just because nature is "free" doesn't mean its worthless.

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