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The Economics of Ecosystems and Biodiversity: Ecological and Economic Foundations

Author

Listed:
  • John M. Gowdy

    () (Department of Economics, Rensselaer Polytechnic Institute, Troy NY 12180-3590, USA)

  • Richard Howarth

    (Dartmouth College)

  • Clem Tisdell

    (University of Queensland)

Abstract

This chapter presents the economic logic behind the concept of discounting the future and discusses how it applies to biodiversity conservation. How should economists account for the effects of biodiversity and ecosystem losses in the immediate and distant future? We discuss how to integrate traditional cost-benefit analysis with other approaches to understand and measure, where possible, environmental values. We conclude that losses of biodiversity and ecosystems have properties that make it difficult to apply standard welfare analysis including discounting the future. Difficulties include: (1) it is a phenomenon having global as well as local consequences, (2) its impacts are long-term and irreversible, (3) pure uncertainty is pervasive, (4) changes are non-marginal and non-linear. And (5) questions of inter- and intra-generational equity are central. This paper will be published as Chapter Six in Pushpam Kumar (ed.). An output of TEEB: The Economics of Ecosystems and Biodiversity. London: Earthscan. 2010.

Suggested Citation

  • John M. Gowdy & Richard Howarth & Clem Tisdell, 2010. "The Economics of Ecosystems and Biodiversity: Ecological and Economic Foundations," Rensselaer Working Papers in Economics 1008, Rensselaer Polytechnic Institute, Department of Economics.
  • Handle: RePEc:rpi:rpiwpe:1008
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    File URL: http://www.economics.rpi.edu/workingpapers/rpi1008.pdf
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    References listed on IDEAS

    as
    1. Chichilnisky, Graciela & Beltratti, Andrea & Heal, Geoffrey, 1998. "Sustainable use of renewable resources, Chapter 2.1," MPRA Paper 8815, University Library of Munich, Germany.
    2. Martinez-Alier, J., 1995. "The environment as a luxury good or "too poor to be green"?," Ecological Economics, Elsevier, vol. 13(1), pages 1-10, April.
    Full references (including those not matched with items on IDEAS)

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    Cited by:

    1. Dikgang, Johane & Muchapondwa, Edwin, 2012. "The valuation of biodiversity conservation by the South African Khomani San “bushmen” community," Ecological Economics, Elsevier, vol. 84(C), pages 7-14.
    2. John M. Gowdy, 2013. "Valuing nature for climate change policy: from discounting the future to truly social deliberation," Chapters,in: Handbook on Energy and Climate Change, chapter 25, pages 547-560 Edward Elgar Publishing.
    3. repec:gam:jsusta:v:9:y:2017:i:12:p:2267-:d:122034 is not listed on IDEAS
    4. Karbowski, Adam, 2016. "Discussion on the Social Rate of Discount: from Sen to Behavioural Economics," EconStor Open Access Articles, ZBW - German National Library of Economics, pages 46-60.

    More about this item

    JEL classification:

    • A10 - General Economics and Teaching - - General Economics - - - General
    • A11 - General Economics and Teaching - - General Economics - - - Role of Economics; Role of Economists
    • P48 - Economic Systems - - Other Economic Systems - - - Political Economy; Legal Institutions; Property Rights; Natural Resources; Energy; Environment; Regional Studies

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