Chapter 44 : The Value of Biodiversity

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A voluminous literature exists on the nature of the value that resides in or is conferred on biological diversity. For many, value is an intrinsic property of biodiversity and not something that can be conferred on it by human pertiception. For if it is tradable, then we can find justifications for losing at least some biodiversity, and perhaps a justification for losing rather a lot of it. First, it is not remotely feasible to conserve all biodiversity—any real world resident would acknowledge that proposition. Second, conservation is not costless. Whether the proximate destroyer of biodiversity is a polluter, a frontier agriculturist, or a logging company, the real causes of biodiversity loss are financial. What economists do is show that these financial equations are incomplete and shortsighted because economics is concerned with the well-being of individuals, whoever they are. The science of environmental economics is, among other things, concerned with eliciting the willingness to pay (WTP) for nonmarket ecological services such as carbon sequestration and biodiversity provision. The economic benefits of biodiversity comprise three general components: the contribution to ecosystem functions, nonuse values, and the contribution to ecosystem resilience. A final consideration in the valuation of biodiversity concerns the value of biodiversity as information. What is missing is the economic value of delaying the losses until more and better information is gathered about the information content of biodiversity.

Citation: Pearce D. 2004. The Value of Biodiversity, p 469-475. In Bull A (ed), Microbial Diversity and Bioprospecting. ASM Press, Washington, DC. doi: 10.1128/9781555817770.ch44

Key Concept Ranking

Carbon Dioxide
Tropical Forest
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1. Anderson, I.,, and P. Hazell. 1989. Variability in Grain Yields: Implications for Agricultural Research and Policy in Developing Countries. Johns Hopkins University Press, Baltimore, Md.
2. Bateman, I.,, R. Carson,, B. Day,, M. Hanemann,, N. Hanley,, S. Mourato,, E. Özdemiroglu,, D. W. Pearce,, and R. Sugden. 2002. Economic Valuation with Stated Preference Techniques: A Manual. Edward Elgar, Cheltenham, United Kingdom.
3. Beckerman, W.,, and J. Pasek. 2001. Justice, Posterity and the Environment. Oxford University Press, Oxford, United Kingdom.
4. Ehrenfield, D., 1988. Why put a value of biodiversity? p. 212 216. In E. O. Wilson (éd.), Biodiversity. National Academy Press, Washington, D.C..
5. Garrod, G.,, and K. Willis. 1999. Economic Valuation of the Environment: Methods and Case Studies. Edward Elgar, Cheltenham, United Kingdom.
6. Page, T. 1977. Conservation and Economic Efficiency. Johns Hopkins University Press, Baltimore, Md..
7. Pearce, D. W. 2001. The economic value of forest ecosystems. Ecosyst. Health 7(1): 1 11.
8. Pearce, D. W. The Distribution of Benefits and Costs of Environmental Policies: Conceptual Framework and Literature Survey. Organisation for Economic Co-operation and Development, Paris, France, in press.
9. Pearce, D. W.,, and D. Ulph,. 1999. A social discount rate for the United Kingdom, p. 268 285. In D. W. Pearce, Economics and the Environment: Essays in Ecological Economics and Sustainable Development. Edward Elgar, Cheltenham, United Kingdom.
10. Pearce, D. W.,, D. Moran,, and D. Biller. 2002. Handbook of Biodiversity Valuation: A Guide for Policy Makers. Organisation for Economic Cooperation and Development, Paris, France.
11. Pearce, D. W.,, and C. Perrings,. 1995. Biodiversity conservation and economic development: local and global dimensions, p. 23 40. In C. Perrings,, K.-G. Mäler,, C. Folke,, C. Holling,, and B.-O. Jansson (éd.), Biodiversity Conservation. Kluwer, Dordrecht, The Netherlands.
12. Randall, A., 1988. What mainstream economists have to say about the value of biodiversity, p. 217 223. In E. O. Wilson (éd.), Biodiversity. National Academy Press, Washington, D.C..
13. van Beers, C.,, and A. de Moor. 2001. Public Subsidies and Policy Failures: How Subsidies Distort the Natural Environment, Equity and Trade, and How to Reform Them. Edward Elgar, Cheltenham, United Kingdom.
14. Weitzman, M. 1998. Why the far distant future should be discounted at its lowest possible rate. J. Environ. Econ. Manage. 36: 201 208.


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Table 1

Values of the discount factor

Citation: Pearce D. 2004. The Value of Biodiversity, p 469-475. In Bull A (ed), Microbial Diversity and Bioprospecting. ASM Press, Washington, DC. doi: 10.1128/9781555817770.ch44

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