The Economic Benefits
of Nature
Note: The following summary is based on a recent article in the journal, Science. Although the authors used
agriculture and aquaculture ("shrimp farming") as the basis of comparison, the implications for other land uses
should be obvious. All too often, the economic benefits of natural systems and nature-based business are discounted
or ignored in decisions that affect these critical functions. Note that only half as much area is in reserves as what is needed.
Special thanks to Center member Rundle Cook of McIntosh County for bringing this article to our attention.
Bulldozing nature to create farms has short-term financial benefits, but it extracts an unprofitable long-term cost.
Economically, it's often better to keep nature as is: forests, swamps and reefs control flooding, absorb carbon dioxide
and attract tourists, who spend billions supporting local businesses with relatively low environmental impact.
Andrew Balmford and his colleagues at the University of Cambridge have quantified some of the advantages in a new analysis,
as displayed below.*
Total economic value per hectare
[A hectare is a metric unit equivalent to about 2.5 acres.]
Forests - $2,570
Farms on former forests $2,110
Marginal benefit of nature...+ 21.8%
Mangroves - $60,400
Shrimp farms on former mangroves $16,700
Marginal benefit of nature.... +261.7%
Wetlands - $8,800
Farms on former wetlands $3,700
Marginal benefit of nature.... +137.8%
Average marginal benefit of nature compared with
development (based on the above 3 examples) = + 140.4%
Reserves Needed
Percent of world's land that is reserves....7.9%
compared with
Percent needed to ensure future of wild nature.... +15.0%
Return on Investment
Estimated annual cost to maintain world's reserves.... +$20 billion to $28 billion
Estimated annual value of their goods and services.... +$4.4 trillion to 5.2 trillion
>NOTE: This means nature requires only about
0.5% of its annual value for proper maintenance!
*Source : Science, August 9, 2002
Compiled, formatted, and analyzed by Center for a Sustainable Coast
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