Sir Partha Dasgupta, Emeritus Professor of Economics at the University of Cambridge, has published a landmark new report, first commissioned by the UK Treasury two years go. Titled ‘The Economics of Biodiversity’, the comprehensive study sets out a global review of the link between biodiversity and economic growth. The Review notes that while the material standard of living of the average person in the world has become far higher today than it has ever been, nature is being degraded at an unprecedented rate – suggesting that “we have been living at both the best and worst of times”.
Sir Partha argues that nations need to adopt a system of economic accounts that records an ‘inclusive’ measure of their wealth, which counts nature as an asset. As such, they suggest that GDP is wholly unsuitable for appraising investment projects and identifying sustainable development. The Review studies the ‘wedge’ between the prices that consumers pay for nature’s goods and services and their social worth in terms of what economists call ‘externalities’. The presence of this wedge is why the citizen investor will insist that companies disclose activities along their entire supply chain.
The author concludes that no social mechanism can meet this problem in its entirety, meaning that no institution can be devised to enforce socially responsible conduct. Therefore, we each must serve as “judge and jury for our own actions”. The Review ends with a plea that education systems should introduce nature studies from the earliest stages of our lives and revisit them in the years we spend in secondary and tertiary education.