You might not have thought about it, but nature provides multiple life-sustaining functions. Plants produce oxygen and absorb carbon, wetland filter water, and bees pollinate critical food plans. Together, theses functions are call “ecosystem services.”
In 1997, the global value of ecosystem services was estimated at $33 trillion (in 1995 $US). That figure comes from a landmark research paper by economist Robert Costanza and colleagues, published in 1998 in the peer-reviewed journal Ecological Economics. The purpose of the study was not to commodify nature, but to assign values so that the true worth of the environment can be counted in economic and policy decisions.
Here’s an example: In mainstream economics, a forest has no worth until it is cut down and the timber is sold. The services provided by the forest—providing habitats and oxygen, and preventing erosion, just to name a few—don’t figure into accounting systems. Environmental damage is written off as an “externality” (an outside cost). But imagine the value of the forest’s services were counted. Imagine if timber deals figured in the loss of these services. This would result in prices that more accurately reflect the true costs of producing timber. Valuing ecosystem services is thus a way to ensure the marketplace sends accurate price signals.
Constanza and his colleagues have updated their original paper to estimates the changes since then. They estimate that the loss of ecosystem services from 1997 to 2011 is on the order of $20 Trillion/yr. Read the paper here.
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