“Due to a lack of knowledge and/or limited possibility of commodification due the impossibility of accurate pricing and the inability to enclose the commons for some environmental goods, it is an open question as to whether it is even possible to value ecosystem services as a whole – as opposed to a select few benefits that flow from particular sets of relations within an area.”
Many economists find valuing global (and most times even local) “ecosystem services” difficult. Nonmarket pricing, indeed, is inherently impossible to solve or thus requires very questionable methodologies.
Critics of environmental commodification argue that the ongoing public funds for such efforts are neither now, nor are they likely to be in the future, justified. Alleged market failure, in other words, is swamped by other failures in the “solution.”…
Continue Reading“Payment schemes also risk creating perverse incentives…. If the system pays landowners to bank carbon, they may plant non-native species, or genetically ‘improved’ trees to bank carbon faster. Or they may discourage natural phenomena that happen to be good for biodiversity but bad for people, including such ecosystem disservices as fire, drought, disease, or flood.”
Just as there are supporters of this relatively new way of looking at environmental decision-making–commodification–there are also critics. I include myself among them.
Some environmentalists argue that ecosystems or their constituent parts with intrinsic value does not mean they should be priced and treated as economic goods. By stressing the market value of ecosystem services, should those values be exceedingly difficult to calculate, or come in at a lower-than-expected value, it will be easier for those pushing more intensive human intervention in the ecosystem to win the day in the policy field.…
Continue Reading[Editor note: Last month, a conference–“Evaluating and Trading Ecological Services: Is There a Role for Natural Capital in the Marketplace?”–was held in Houston, Texas. Local environmental activist Jim Blackburn organized the event (interviewed here). Appendix A describes the conference, and Appendix B lists the sessions.
Without a speaker challenging the premise of the conference, MasterResource asked Sterling Burnett of the National Center for Policy Analysis to provide this analysis, which will be forwarded to conference organizers.]
Pricing nonmarket ecosystem services may be a noble goal. But it is conceptually confused and problematic as a guide to real-world action, civic and certainly governmental.
This four-part series substantiates my concerns. After reviewing the general concept, I will examine environmentalist concerns with environmental commodification, review economist concerns with the same, and make final arguments and wrap-up.…
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