TEEB @ Yale – Part 1: Introduction to Valuing Nature

I’ve been following the developments of UNEP sponsored The Economics of Ecosystems and Biodiversity project for a while now, but have yet to have a good chance to read through one of their many reports in detail. Earlier this year In late 2011 TEEB announced that the lecture series held at Yale would be made available online, and now it seems a good part of the videos are available (there are apparently 14 in total).

Apparently not the TEEB approach to valuing nature. Image: Seppo.net

In this first lecture, Pavan Sukhdev focusses primarily on the ‘why’ of valuation – the so-called economic invisibility of nature. Essentially it boils down to being a case of ‘if you can’t measure it, you can’t manage it’.

I think it’s important to keep in mind that this doesn’t necessarily require putting a monetary price on biodiversity. Unlike cost-benefit analysis (which do require the costs and benefits to be in the same units, usually dollars), the cost-effectiveness frameworks used by Joseph et al. (2009) and Carwardine et al. (2011) simply define the benefit part of the equation in terms of probability of species persistence and management effectiveness, and still allows for the prioritisation of investment.

That said, I can see how there may be cases where monetary evaluation may be more likely to spur business and finance sectors into the stewardship of natural capital, as Sukdev puts it, rather than (or in addition to) ecological or philosophical concepts of value.

Sukhdev does take a bit of a swipe what he calls the obsession with Big Global Numbers – that is, the Costanza (1997) study which valued the planet’s ecosystem services at $38 trillion a year – which he rightfully said is not useful at a regional or local scale, but nonetheless has helped to bring forward the idea of nature having an economic value into the mainstream.

He also makes a point of emphasising that the point of TEEB is “not a cost-benefit based solution for stewardship of the Earth”, or “pricing bees” – a point which has been raised by critics. Keeping in mind that CBA is still a huge part of their approach, it seems the TEEB vision is for valuation to inform various norms, policies and regulations, and a range of economic mechanisms that are not necessarily “the market”.

One final point of interest – despite the criticisms raised about global analyses, it seems TEEB has undertaken another global CBA based on benefits-transfer :) which examined eight scenarios, ranging from boosting agricultural productivity, reducing deforestation and increasing protected area coverage to 20%. While Sukhdev makes the point that boosting agricultural productivity and reducing deforestation had the largest benefit, by examining the slides it seemed that dietary change had the largest benefit, but the CBA ratio wasn’t calculated due to lack of cost data. The slide quoted the Willett diet, which seems to favour increased vegetable and grain intake, and decreasing or cutting out red meat. If that’s the case, it’s not really surprising that this had such a large benefit – but I wonder why the cost could not be calculated. That seems like a major drawback from the study if the results are skewed towards scenarios based on data availability.

There was much more to the lecture than what I’ve commented on here, and overall the video series looks to be a useful resource. The only criticism/comment I have  would be for TEEB to make the slides available in a separate PDF file, or perhaps on SlideShare (so I don’t have to worry about taking screengrabs of the slides while I watch the video!). I’ll post further videos here as I get through them.

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