Showing papers on "Green economy published in 2003"

Economics weak and strong: Ecological economics and human survival

Abstract: Mounting evidence suggests that the human impact on the planet is reaching the point where the Earth's ecosystems will not be able to support the level of human occupation. The global economy also seems to be generating income disparities that threaten the social stability of even the most developed economies. Although both these trends are rooted in the operation of the global market economy, standard economics has surprisingly little to offer in the way of policies that might allow us to survive the twenty-first century with our current social and environmental systems intact. This article examines our current predicament from the point of view of neoclassical welfare economics and the alternative framework of ecological economics. We argue that ecological economics, by placing the study of economics squarely within human society and ecosystems, can lead the way to make economics both scientifically credible and policy relevant.

Valuing ecosystem services in a green economy

Abstract: SCOPE: Ecosystems are being degraded and destroyed worldwide at a rate unprecedented in human history. Accordingly a great deal of interest is currently being focussed on ecosystems, the role they play in planetary life support, and the need for a market mechanism to conserve these formerly regarded 'free' goods and services. This research project is concerned with the various divisions or branches within economics dealing with environmental valuation, including applied economics in the form of valuation practice, environmental science, and ecology. It is thus both multi-disciplinary and interdisciplinary and has as its central theme the use of a surrogate market to establish shadow prices for ecosystem services. METHODOLOGY: Twenty ecosystem attributes were identified as being common to all ecosystems depending on the level of integrity, and ranked in order of importance on the basis of a range of criteria. This was achieved by a systematic analysis, namely a multiple criteria analysis, and a social study, in the form of a Delphi philosophical inquiry. These two methods incorporated many different perspectives: namely anthropocentric, utilitarian (economic), ecological, aesthetics, equity, risk and uncertainty. The weightings provided by the panellists were non-pecuniary, and as such were not subject to any bias or odium that may have been associated with putting monetary values on nature’s gifts. The non-pecuniary weightings assigned by the panellists were converted to dollar values by empirically linking them to the surrogate market, namely the property market in the region, and calculating the value of a flow of benefits emanating from them (the economic rent). A valuation table was devised to assess the ecosystem integrity of individual ecosystems on private or public land and a conceptual model devised for landscapes. The case study area was the Wet Tropics World Heritage Area of northeast Queensland. RESULTS: The Delphi panel reached consensus in all three rounds of questionnaires, and the weights provided for the twenty attributes for all three models in the multiple criteria analysis showed a significant level of agreement between the disciplines represented on the panel. The ten ecosystem services ranked most important were: biodiversity; refugia; erosion control/soil and sediment retention; genetic resources; gas regulation; climate regulation; biological control; purification (clean air, water); disturbance regulation; and aesthetics, in that order. The total value of ecosystem goods and services in all the tenure categories in the Wet Tropics World Heritage Area (8,944 km2) was determined to be in the range AUD$188 to $211 million year-1, or AUD$210 to $236 ha-1yr-1 across tenure categories. The individual ecosystem services mentioned above ranged from AUD$18.6 to $20.9 million year-1 for biodiversity down to AUD$10.2 to $11.4 million year-1 for aesthetics. The value of individual ecosystem services constrained within a fully intact suite of ecosystem goods and services was found to be consistent with the value of all other uses to which land is put in a bioregion and with other avenues of investment in the economic system, and will increase proportionate to the human population density, and hence scarcity of ecosystem services. CONCLUSION: The combination of revealed preferences in a surrogate market as the empirical baseline for the whole suite of ecosystem services in a bioregion or Local Government Area, along with the expressed preferences of a group of experts as to the importance of each individual good or service, provides the theoretical and practical justification for the acceptance of the technique as a means of establishing opening prices in a future trading market. Being linked to the value of real property and hence population density in a region, it provides a key insight into the status and thus value of ecosystems services provided by public and private land, including scarcity. The most critical recommendation to policy and decision-makers emanating from this research is the requirement that environmental impacts arising from development projects, policies or proposals be properly identified, the magnitude of the impact properly assessed, and mitigation of the impacts strictly enforced. The same applies for environmental pollution, damage and degradation with legal liability apparent. Legislation is required to be enacted which will lead to the need for rigorous environmental valuation procedures that have empirical verification and will stand scrutiny in a court of law. The technique expounded in this thesis is such a procedure.