Valuing Ecosystems

Question 1

Describe neoclassical economics

Answer 1

• buyers want lowest price, sellers want highest price
• results in a compromise price, and the “right” quantities are sold

Question 2

What are 4 assumptions of the neoclassical theory?
Why are these problematic?

Answer 2

1. resources are infinite or replaceable
2. long-term effects should be ignored
3. costs and benefits are internal
4. growth is good & it’s the only thing that matters

Problem: massive enviro implications!! Not at all sustainable

Question 3

Tragedy of the Commons=

The tragedy of the commons is strongly connected to ____ ____

Answer 3

= analogy that shows how people driven by self-interest can end up destroying the resource that they all depend on

Malthusian catastrophe

Question 4

Neoclassical economics assumes that costs and benefits are internal. Why is this not the case?

Answer 4

everything is connected! Your decisions will always impact others somehow
= externalities (can be + or -, usually - in this case)

Question 5

What could be a solution to neoclassical economics and the problems it has?

Answer 5

think beyond a single economic bottom line (which is the net income of a company/ gov- traditional economics)

Question 6

single bottom line system=

Answer 6

generating profit is the only focus
- only considering themselves

Question 7

triple bottom line system (3BL or TBL)=

Answer 7

being socially and environmentally responsible is used together with profitability to evaluate the performance/ success of a company.
Considers:
- economics (profit)
- social (people)
- environmental (planet)

Question 8

What are the 3 P’s of the 3BL system?

• When is it sustainable?
• When is it “bearable”?
• When is it “Viable”?
• When is it “Equitable”?

Answer 8

People, planet, profit

• Sustainable only when all 3 are considered (people, planet, profit)
• Bearable: planet and people are considered
• Viable: planet and profit are considered
• Equitable: people and profit are considered

Question 9

Ecosystem goods and services=

Answer 9

the benefits humans derive (directly or indirectly) from ecosystem functions

Question 10

ecosystem function=

Answer 10

the capacity of natural processes & components to provide goods & services that satisfy human needs (directly or indirectly)

Question 11

What are the 4 types of ecosystem services?

Answer 11

• provisioning
• regulating
• cultural
• supporting

Question 12

ecosystem services: provisioning=

list 4 examples

Answer 12

the delivery (provisioning) of products that we directly use
- water
- food
- energy
- medicine

Question 13

ecosystem services: regulating=

list 1 example

Answer 13

services provided that regulate our environment
- flood control

Question 14

ecosystem services: cultural

list 2 examples

Answer 14

“non-material” benefits that enrich the human experience

• hiking
• nature- inspired art

Question 15

ecosystem services: supporting

give 1 example

Answer 15

the provision (delivery) of ecosystem processes needed to support life and all other ecosystem services
* essential to survival of us and the planet

• soil formation

Question 16

Who introduced the triple bottom line system? When?

Answer 16

John Elkington in 1994

Question 17

Given this list of ecosystem services, which category would each be in?
1. nutrient cycling
2. water regulation
3. food production

Answer 17

1. supporting category
2. provisioning category (because the regulation of hydrological flows= provisioning of water for our different sectors)
3. provisioning category

Question 18

ecosystem valuation= using ___ as a common unit

Answer 18

money

Question 19

capital=

Answer 19

goods & services of economic value; resources that can be used to produce goods

Question 20

social capital=

Answer 20

the value of relationships between people

Question 21

natural capital=

Answer 21

the summation of all the ecosystem services on earth, available to us for free

Question 22

ecosystem valuation=

Answer 22

the assignment of economic value to an ecosystem or ecosystem services
*values are based on current market prices; constantly updated

Question 23

ecosystem valuation often represents:
1.
2.

Answer 23

1. the monetary cost of replacing the ecosystem service
2. the monetary value of the capital gained from the resource (based on historical data)

Question 24

Ecosystem valuation
The value of forest carbon (carbon sequestration) in Alberta would be $_____ based on current amount stored (4.8 billion tonnes)

Answer 24

$144 billion

Question 25

economic development=

Answer 25

progress made toward a sustainable economic system

Question 26

have we achieved a sustainable economic system yet?

Answer 26

no :( most countries still support a rapid economic growth rather than a sustainable economic development (especially developing countries) - this is partly b/c of pressure from public (jobs etc)

Question 27

T/F many ecosystem services are only substitutable (replaceable) up to a certain point

Answer 27

true

Question 28

- which ecosystem service has the highest global value? - Are marine or terrestrial ecosystems more valuable? - give 2 examples of places with very high global value

Answer 28

- nutrient cycle - marine - amazon rainforest, coasts

Question 29

If an ecosystem services completely loses its value, what does that mean?

Answer 29

we've destroyed it/ overused it :(