The Economics of Biodiversity: The Das Gupta Review

The UK Government commissioned Professor Sir Partha Dasgupta of the University of Cambridge, to lead an independent, global Review on the Economics of Biodiversity. The Review was released in early 2021. The key messages of the Review were: 

• Our economies, livelihoods and well-being all depend on our most precious asset: Nature. Biodiversity enables Nature to be productive, resilient and adaptable.
• We have collectively failed to engage with Nature sustainably, to the extent that our demands far exceed its capacity to supply us with the goods and services we all rely on. Estimates show that between 1992 and 2014, produced capital per person doubled, and human capital per person increased by about 13% globally; but the stock of natural capital per person declined by nearly 40%.
• Our unsustainable engagement with Nature is endangering the prosperity of current and future generations. 
• Biodiversity is declining faster than at any time in human history. Current extinction rates, for example, are around 100 to 1000 times higher than the baseline rate, and they are increasing.
• At the heart of the problem lies deep-rooted, widespread institutional failure. Nature’s worth to society – the true value of the various goods and services it provides – is not reflected in market prices because much of it is open to all at no monetary charge. These pricing distortions have led us to invest relatively more in other assets, such as produced capital, and underinvest in our natural assets.
• The solution starts with understanding and accepting a simple truth: our economies are embedded within Nature, not external to it. While most models of economic growth and development recognize that Nature is capable only of producing a finite flow of goods and services, the focus has been to show that technological progress can, in principle, overcome that exhaustibility. This is to imagine that, ultimately, humanity is ‘external’ to Nature. 
• The Review develops the economics of biodiversity on the understanding that we – and our economies – are ‘embedded’ within Nature, not external to it. 
• We need to change how we think, act and measure success. We should:
• Ensure that our demands on Nature do not exceed its supply, and that we increase Nature’s supply relative to its current level.
• Change our measures of economic success to guide us on a more sustainable path. Introducing natural capital into national accounting systems would be a critical step towards making inclusive wealth our measure of progress.
• Transform our institutions and systems – in particular our finance and education systems – to enable these changes and sustain them for future generations.
• Transformative change is possible – we and our descendants deserve nothing less.