Medioimages/Photodisc/Getty Images
READ MORE ABOUT:
It's becoming increasingly popular for not only tree-hugging environmentalists to care about nature, but economists as well. At least, the smart ones. In 1997, one study estimated that nature provides an average of $33 trillion worth of services annually.
That study has not gone without controversy, but—whether its authors wanted to foster investment opportunities, or had the foresight to know that's how to get people to care about the environment—it was on the early side of a trend that has since been picking up: recognizing that nature conservation is vital not only for the sake of future generations (and for itself), but also for a healthy economy.
From climate regulation to erosion control to the maintenance of water supplies, nature provides us with services and resources that we recognize, and perhaps even more that we don't. Healthy ecosystems ensure that water gets stored when and where it is naturally supposed to and that it goes through some kind of cleansing or filtration process. Healthy ecosystems are ones that cycle nutrients regularly, and in which soil gets formed as it is needed—and in the quantities and quality that we depend on for all the things we use soil for, not least of which is food production.
What's so beautiful about nature is that it is so interconnected, it's hard to separate out the individual factors that keep it going. That makes it harder to quantify their value, but it also inspires admiration—smart as humans are, we haven't come close to designing anything nearly as intricate. But given the precarious state of the environment today, there are increasing efforts to assign dollar values to individual species and unique ecosystems, so that efforts to save them can be legitimized and adopted beyond the traditional environmental community.
Calculating nature's worth
A 2006 United Nations Environment Programme report valued coral reefs at $1 million per square kilometer in places like Indonesia and the Caribbean, where tourism is dependent upon them for their role in maintaining sandy beaches and attracting snorkelers and scuba divers. Reefs are also an important source of employment: most of the developing world's 30 million small-scale fishers, for example, are dependent on coral reefs—more than 1 million in the Philippines alone rely directly on coral reefs for their livelihoods. And the fisheries themselves, according to the UNEP study, provide an annual value between $15,000 and $150,000 per square kilometer. These reefs are worth more alive than dead, yet the threats facing them are not small.
Mangroves are perhaps even more valuable—in some areas estimated up to $3.5 million per square kilometer, because they not only support the health of fisheries and provide forestry products, but they also serve as a buffer for ocean waves. And that is no small feat: 200 meters of mangrove can deplete 75 percent of a wave's energy—which explains why areas buffered by coastal forests (like mangroves) were found to have been less damaged by the 2004 tsunami than those without such forested areas.
And then there's living, breathing, moving wildlife. Honeybees have been getting a lot of attention lately because they are on a drastic and mysterious decline. But it's not just honeybees: insects in general contribute at least $57 billion a year to the U.S. economy, according to the Xerces Society.
They serve irreplaceable roles of pollination, pest control by eating other insects, serving as food other wildlife, and the dung beetle alone is valued at $380 million, because it eats manure that would otherwise attract parasites that farmers would have to control. Without the dung beetle, farmers would also have to spend more on fertilizer (also meaning higher pollution levels) because the nutrients that dung beetles help to return to the soil would be lost. And who knows where those nutrients will end up instead, and what changes they'll incur when they get there...
Be sure to check out
Nature Inc.
to follow this issue and learn about some of the forward-thinking investors who are putting down payments on nature.
Learn more:
Investing in Nature: Which Companies Get It?
What You Need to Know About Ocean Acidification
The Uncertain Future of Bees with National Bee Expert Dennis vanEngelsdorp
-
- {}
