Economics Need New Metrics on the Price of Nature
Tensions between economic growth and responsible environmental stewardship have come under scrutiny at the World Economic Forum in Davos, 2024. […]
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Tensions between economic growth and responsible environmental stewardship have come under scrutiny at the World Economic Forum in Davos, 2024. The past three decades have been marked by a stark divergence: while global Gross Domestic Product (GDP) has more than doubled, our natural capital—a term referring to the planet’s stock of renewable and non-renewable resources—has declined nearly 40%. Given that more than half of the world’s GDP is deeply dependent on nature, there’s an urgent need for a new calculus, one that reincorporates ecology into our understanding of economics.
The Need for New Metrics: Gross Ecosystem Product
GDP, the conventional measure of an economy’s output, is increasingly seen as an incomplete metric, one that turns a blind eye to environmental degradation and the depletion of natural resources. The rallying cry for a more encompassing measure has gained momentum, leading to the proposal of the Gross Ecosystem Product (GEP). Drawing on the tenets of environmental science, the GEP attempts to quantify the value of ecosystem services like clean air, water, and biodiversity—elements vital to humanity’s survival and economic stability.
Adopting the GEP as a metric could yield a holistic view of an economy’s health. It takes into consideration the value of natural goods and services which in turn could act as a motivator for the sustainable use of resources. Moreover, it lays the groundwork for better-informed policies that blend economic growth with environmental preservation. For instance, a study conducted on the Qinghai-Tibet Plateau revealed the immense value inherent in the region’s ecosystem services, arguing for consideration of such natural capital in subsequent policymaking processes.
Integrating Nature into Decision-Making
Environmental Accounting
Environmental accounting could serve as a crucial instrument in incorporating ecological concerns into our national accounts. By integrating natural resources and environmental assets into the existing System of National Accounts (SNA), nations can gain an in-depth understanding of the economic contributions made by natural resources and the costs associated with their preservation or depletion.
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Dr Marina Nani
Editor-in-Chief
Editor-in-Chief of Rich Woman Magazine, founder of Sovereign Magazine, author of many books, Dr Marina Nani is a social edification scientist coining a new industry, Social Edification. Passionately advocating to celebrate your human potential, she is well known for her trademark "Be Seen- Be Heard- Be You" running red carpet events and advanced courses like Blog Genius®, Book Genius®, Podcast Genius®, the cornerstones of her teaching. The constant practitioner of good news, she founded MAKE THE NEWS ( MTN) with the aim to diagnose and close the achievement gap globally. Founder of many publications, British Brands with global reach Marina believes that there is a genius ( Stardust) in each individual, regardless of past and present circumstances. "Not recognising your talent leaves society at loss. Sharing the good news makes a significant difference in your perception about yourself, your industry and your community."
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