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Ecological Economics & Nature Conservation

Image from: http://ksjtracker.mit.edu

Conservation and Environmental Concerns are embedded in and inter-connected

with other World Problems

War & Political Unrest

Famine

Human PopulationGrowth

Extinction Crisis

Environmental Degradation

Social Inequality

Poverty

Photo from Greg Dimijian

Interconnectedness of World Problems

Economics strongly influences policy considerations for the entire constellation of inter-connected world problems

Image from Wikipedia

Adam Smith(1723 – 1790)

An Inquiry into the Nature & Causesof the Wealth of Nations

(1776)

Economics

Adam Smith – “father of modern economics”

Economics

Adam Smith – The Wealth of Nations (1776)

Human motives are often driven by self-interest, but competition in the free market would tend to keep prices low, yet create incentives

for a wide variety of goods and services

The free market appears chaotic and unrestrained, but selfish interests may help guide it by their collective “invisible hand” to supply the right amount and

variety of goods and services to meet demand

“It is not from the benevolence of the butcher, the brewer, or the baker that we expect our dinner, but from their regard to their own [selfish] interest”

Definition of economics from Levitt & Dubner’s (2005) Freakonomics:“explaining how people get what they want”

Photo from www.mapofsaltspring.com

Environmental Economics

Garrett Hardin – The Tragedy of the Commons, article in Science (1968)

Even so, multiple individuals acting in their own self-interest can destroy a shared resource (e.g., a “commons”)

Journal cover from the 12 December 2003 issue of Science; www.sciencemag.org

The “commons” was used as a metaphor for the Earth and its growing

human population

Garrett Hardin – The Tragedy of the Commons, article in Science (1968)


Elinor Ostrom (first woman to win Nobel Prize in Economics – 2009) has shown that on the small-scale,

the tragedy is often avoided by cooperation among the commons’ users, who impose sanctions, etc.

on those who cheat

Ecological / Environmental Footprints

Individual herders (or people) collectively place more “footprints” on the commons (or Earth) than can be supported

House size statistics from U. S. Census Bureau: http://www.census.gov/const/www/highanncharac2006.htmlPhoto of house construction from: http://blog.gogrid.com

“The average single-family house completed [in 2006] had 2,469 square feet, 769 more square feet than in 1976…”


J. Diamond – New York Times Op-Ed (January 2, 2008)“What’s Your Consumption Factor?”

Quote from: http://www.nytimes.com/2008/01/02/opinion/02diamond.htmlMap from Wikipedia; data to produce map from Global Footprint Network – http://www.footprintnetwork.org

“The average rates at which people consume resources like oil and metals, and produce wastes like plastics and greenhouse gases, are about 32 times higher

in North America, Western Europe, Japan and Australia than they are in the developing world.”


Pets can have large ecological “pawprints”

Robert & Brenda Vale (2009) Time to Eat the Dog: The Real Guide to Sustainable LivingSee: New Scientist article – http://www.newscientist.com/article/mg20427311.600-how-green-is-your-pet.html

Calculated ecological “pawprint” of medium-sized dog in the U.S.;

it was more than twice the ecological “treadprint” of an SUV (4.6-liter Toyota

Land Cruiser driven 10,000 km/yr)

“The estimated number of household cats and dogs exceeds 100 million each, a global population size that easily outdistances that of any wild carnivore”

(Van Valkenburgh & Wayne, 2010, Current Biology 20:915-919)


With respect to matter, the economy is an open

subsystem of a closed, finite total system – the biosphere

Steady-State Economics Model

Matter cycles within and energy flows through the

global ecosystem


Figure from Jackson et al. (2001) Ecological Applications

With respect to matter, the economy is an open

subsystem of a closed, finite total system – the biosphere


Matter cycles within and energy flows through the

global ecosystem E.g., water cycle



No escape from the Laws of

Thermodynamics

E.g., 1st Law of Thermodynamics =

Conservation of Energy


Quote from E. O. Wilson’s foreword to Jeffrey D. Sachs’ (2008) Common Wealth


Modern humanity arose ~10,000 yr ago “with the invention of villages and

political hierarchies… The economic history that

followed can be summarized very succinctly

as follows: people used every means they could

devise to convert the resources of Earth into

wealth.”



Distinction between growth and development

Can there be development without growth?

Can there be growth without development?



Sustainability – amount of consumption that can be

sustained indefinitely without degrading

capital stocks (including natural capital)

Short-term consumption

rate

Capital stocks

Trade-off


Sustainability – amount of consumption that can be sustained indefinitely without degrading capital stocks


rate

Capital stocks

?

Unsustainable

Sustainable



Photos from Wikipedia


Interesting parallel with organismal life-history evolution;“a jack of all trades is master of none”

Life-history trait A, e.g., current reproductive

output

Life-history trait B, e.g., future survival

E.g., Blue whale (one offspring every 2-3 yr; 80 yr life-span)

E.g., King (chinook) salmon (many thousands of offspring; single reproductive bout)


rate

Capital stocks

?

Unsustainable

Sustainable



Photo from Wikipedia

Economics Strongly Influence Policy

Cost-Benefit Analysis

At first blush it appears simple…

Costs > Benefits project should not proceed

Costs < Benefits project should proceedxxx


Cost-Benefit Analysis

However, it must convert all costs and benefits to the same currency, and it must consider all of the trade-offs, both instrumental and intrinsic value (which is especially hard to monetize), hidden costs, and externalities

Externality

A true cost (usually in terms of environmental degradation) resulting from an economic transaction that is not

included as a debit against economic returns

Photo from www.whale.net


Willingness to Pay

How much would you be willing to pay to protect Blue Whales?

Photo from newportbeachchristmasparade.wordpress.com


Travel Cost Method

How much do people pay to see Blue Whales?


Present Value and Discounting

How many of you would rather receive $100 today vs. the equivalent of $100 in a year’s time?

Costs and benefits often change value over time

The general preference to receive good things now (and put bad things off until later) is called time preference

Many economists advocate converting all future costs and benefits to present value; future sums of money

are discounted by a rate that reflects time preference


Environmental Impact Assessment

The process of identifying the potential impacts of a project or policy before it goes into effect

Required of certain federal projects in the U.S. since the National Environmental Policy Act (NEPA)

was enacted in 1970


Risk Assessment and Management

Risk = the probability of a given potential hazard causing a given consequence, multiplied by the magnitude (severity)

of that consequence


Precautionary Principle

Since not all possible negative consequences of a project can be known ahead of time, this ethical principle states that if the consequences

are judged by some informed persons to have a high likelihood of being negative, it is better to

abandon the project

“How Much is Left?”Web resource available through Scientific American,

to accompany their September 2010 issue

http://www.scientificamerican.com/article.cfm?id=interactive-how-much-is-left

Limits to Natural Resource Use…

http://www.scientificamerican.com/article.cfm?id=interactive-how-much-is-left

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