By Jerri-Lynn Scofield, who has worked as a securities lawyer and a derivatives trader. She is currently writing a book about textile artisans.
University of Cambridge scientists, with the Royal Society for the Protection of Birds, this week released a study – the largest to date of its kind – suggesting that the idea that economic development, in the form of farming, logging or other resource extraction – necessarily produces more value than leaving wetland and woodland ecosystems intact is false.
The team examined dozens of sites, worldwide, rinclding some in China, Fiji, Kenya, Nepal, as well as the U.K.
In other words, as the Guardian tells the story in Land could be worth more left to nature than when farmed, study finds:
….further modifying nature for human use could be costing society more than it benefits it, but these “natural capital” costs are often not taken into account by decision-makers.
The latest study, The economic consequences of conserving or restoring sites for nature, was published in the journal Nature Sustainability. From the abstract:
Nature provides many benefits for people, yet there are few data on how changes at individual sites impact the net value of ecosystem service provision. A 2002 review found only five analyses comparing the net economic benefits of conserving nature versus pursuing an alternative, more intensive human use. Here we revisit this crucial comparison, synthesizing recent data from 62 sites worldwide. In 24 cases with economic estimates of services, conservation or restoration benefits (for example, greenhouse gas regulation, flood protection) tend to outweigh those private benefits (for example, profits from agriculture or logging) driving change to the alternative state. Net benefits rise rapidly with increasing social cost of carbon. Qualitative data from all 62 sites suggest that monetization of additional services would further increase the difference. Although conservation and restoration did not universally provide greater net value than the alternative state, across a large, geographically and contextually diverse sample, our findings indicate that at current levels of habitat conversion, conserving and restoring sites typically benefits human prosperity. [Jerri-Lynn here: my emphasis.]
Professor Sir Partha Dasgupta’s Comprehensive Review Commissioned by UK Treasury
Last month, Professor Sir Partha Dasgupta released a comprehensive review, commissioned by the UK Treasury, which according to this Guardian account, Economics’ failure over destruction of nature presents ‘extreme risks’, concluded:
The world is being put at “extreme risk” by the failure of economics to take account of the rapid depletion of the natural world and needs to find new measures of success to avoid a catastrophic breakdown, a landmark review has concluded.
Now, I’ve yet to study Dasgupta’s 600 page review, so I will rely here on the Guardian’s summary of that tome:
Prosperity was coming at a “devastating cost” to the ecosystems that provide humanity with food, water and clean air, said Prof Sir Partha Dasgupta, the Cambridge University economist who conducted the review. Radical global changes to production, consumption, finance and education were urgently needed, he said.
The 600-page review was commissioned by the UK Treasury, the first time a national finance ministry has authorised a full assessment of the economic importance of nature. A similar Treasury-sponsored review in 2006 by Nicholas Stern is credited with transforming economic understanding of the climate crisis.
The review said that two UN conferences this year – on biodiversity and climate change – provided opportunities for the international community to rethink an approach that has seen a 40% plunge in the stocks of natural capital per head between 1992 and 2014.
“Nature is our home. Good economics demands we manage it better,” said Dasgupta. “Truly sustainable economic growth and development means recognising that our long-term prosperity relies on rebalancing our demand of nature’s goods and services with its capacity to supply them. It also means accounting fully for the impact of our interactions with nature. Covid-19 has shown us what can happen when we don’t do this.”
Study Published This Week In Nature Sustainability
Back to the much shorter and therefore more tractable study published this week in Nature. This study suggests that the notion that there is necessarily a trade off between economic benefits that follow from development and qualitatively different benefits that arise from conservation, preservation, or restoration of nature is false. From the Guardian,Land could be worth more left to nature than when farmed, study finds:
For the latest study, scientists worked out the annual net value of the chosen sites if they stayed “nature-focused” compared with an “alternative” non-nature focused state over 50 years. They valued each tonne of carbon as worth $31 (£22) to global society, a calculation generally considered to be quite conservative.
More than 70% of these nature-rich sites were found to be worth more in net economic benefits to people if they were left as natural habitats, and all forested sites were worth more with the trees left standing, according to the paper, published in Nature Sustainability. This suggests that even if people were only interested in money – and not nature – conserving these habitats still makes financial sense. Jerri-Lynn here: my emphasis.
The senior author of the research expanded on and reinforced that point in a University of Cambridge press release, Economic benefits of protecting nature now outweigh those of exploiting it:
Andrew Balmford, Professor of Conservation Science at Cambridge and senior author of the research, said: “Current rates of habitat conversion are driving a species extinction crisis unlike anything in human history.”
“Even if you are only interested in dollars and cents, we can see that conserving and restoring nature is now very often the best bet for human prosperity. The findings echo at an operational scale the overall conclusions drawn by the Dasgupta Review,” he said.
The study’s lead author cautioned against surrendering to potential biases when analysing the question.From the Guardian:
The study’s lead author, Dr Richard Bradbury, head of environmental research at the RSPB and an honorary fellow at Cambridge University, said: “As a conservation scientist at RSPB, you have to be acutely aware of your potential prejudices and be as neutral as possible in the analysis. Yet I was still surprised at how strongly the results favoured conservation and restoration.”
Now, this study is certainly important, especially if policy makers are making decisions according to a spurious trade-off, which doesn’t value conservation or restoration properly. But there’s also a danger of over-reliance on the putative economic benefits as sole rationale for following sound conservation-focused land management policies. One big challenge that must be faced in trying to work our way out of the environmental mess in which we are trapped is in thinking what we should be doing isn’t going to require draconian restructuring and impose wrenching costs. We cannot just keep bumbling along.
This latest study seems to suggest we can have our conservation cake and eat our economic benefit too, and I think that just might be a bit too good to be true.
Another point the makes is that economic development – as opposed to leaving land as is – is often heavy subsidized. Such is the case for much farmland conversion, which is often not economically viable without being propped up by public support. So, when the costs of public subsidy are considered, the conservation option is even more attractive.
Or, in a less straightforward situation, where a habitat requires some restoration, the case for dedicating public funds to that goal rather than to farm subsidies might be more compelling. Lead author Bradbury noted in the University of Cambridge press release:
“We need nature-related financial disclosure, and incentives for nature-focused land management, whether through taxes and regulation or subsidies for ecosystem services.”
A couple of further points, also from the Guardian:
This analysis assumes that carbon is properly accounted for, but even without taking into account the value of carbon, natural sites are still more valuable 42% of the time when left as they are. Dr Kelvin Peh, of Southampton University, a co-author of the study, said: “People mainly exploit nature to derive financial benefits. Yet in almost half of the cases we studied, human-induced exploitation subtracted rather than increased economic value.”
The study’s authors are careful to note that their work does not suggest we should abandon all forms of development:
The authors insist that their study should not be used to argue for widespread abandonment of human-dominated landscapes, but said it shows there are lessons to learn about the way we treat natural capital. “We dismiss the flow of services that aren’t easily captured on markets at our peril,” said Bradbury. “As much as I’d like the world to work in a different way, people make economic decisions on the basis of information like this.”
Yet, the bottom line seems clear: policymakers should recognise that conservation produces economic benefits. As per the University of Cambridge press release:
Study co-author Anne-Sophie Pellier from BirdLife International added: “Our results add to evidence that conserving and restoring key biodiversity areas makes sense not only to safeguard our natural heritage, but also by providing wider economic benefits to society.”
Much to mull here; I must reflect on this study further.