Introduction to Valuing Nature (Pavan Sukhdev)

Pavan Sukhdev / Yale lecture / November 2011

In this lecture at Yale economist Pavan Sukhdev explores in detail how nature can be valued. Business as usual is not an option because it is destroying natural capital that we all depend on.

He outlines reasons why it is important to understand and value the services provided by nature. These are because at present nature is invisible, policy makers need new tools to protect the environment and also the dependence of hundreds of millions of poor people on nature for their incomes.

Pavan Sukhdev blog April 2014, Huffington Post: Valuing Natural Capital: What Next and Why?

It’s time to recognise that natural capital is as important as physical capital. A way to do this is to include natural capital in national accounts otherwise it can be left out of decision-making.

When valuing nature several things have to be taken into consideration including:

• What are the trade-offs, discount rates and ethical choices?

Sukhdev discusses the dilemma of choosing between satisfying immediate social needs and long-term protection of ecosystem services.

Other questions to bear in mind:

• What are the marginal costs and benefits?
• What was the purpose of the valuation?
• Who is doing the valuing?
• Will valuing lead to monetising ecosystems?
• How will valuation affect property rights?

A map of TEEB related projects can be found here.

Read a summary of the landmark The Economics of Ecosystems and Biodiversity (TEEB) synthesis report

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This summary was prepared by Why Green Economy?. The views expressed have been paraphrased. See the original source for more information.