With the world’s human population burgeoning, we face the question of whether or not mankind can live on the world’s biological “interest” rather than using its “capital,” as we are now doing. In order not to consume our natural capital, we must ensure that our withdrawal of goods from nature does not exceed its capacity to renew them. One can estimate the importance and/or value of biodiversity in tropical forests (and elsewhere) according to a variety of criteria. Humans have long ignored this question, since biodiversity seemed infinite, and, more to the point, infinitely exploitable, in the way that land resources, bison and passenger pigeons in the United States appeared inexhaustible prior to the 20th century. Now, however, as it becomes apparent that human expansion has endangered ecosystems, air and water quality, and even the protective ozone layer of the atmosphere, we have begun to ask this question – of what value is biodiversity to us, to what extent should we protect it, and what consequences will accrue if we eliminate it? Many feel that we must evaluate (in an economic sense) various aspects of our environment since we realize now that it is possible that we might destroy them. Since our economic activities have led to the endangerment of many ecosystems and to a substantial loss of biodiversity, some feel that we must justify their survival on an economic basis. Others feel that in doing so, “we will be left with nothing but greed” (Ehrenfeld, 1988) and that the value of biodiversity should be evident.

a. Let us first examine some of the factors involved in the rational choices made by humans to deplete natural resources, to destroy ecosystems, and to pollute the environment.

i) Economic factors: Determining to utilize resources for economic reasons depends on the relative valuation of our present usage versus restriction of use or preservation of the “commodity” (i.e., natural resources) for future use. The difference between natural resources and other economic resources is that natural resources cannot be immediately renewed, or may not be renewable at all. Thus “harvesting” these resources is a tradeoff between present benefits and future costs (and this calculation depends upon how the future costs are valued in comparison to the present benefits). If this future cost is “discounted” (i.e., devalued) severely, then it will appear to be more appropriate (economically, at least) to deplete the resource now and invest the proceeds in a “growth” industry. Whether or not this is a desirable way to contemplate natural resources is debatable, particularly since people at the present day may value (future) resources differently from the way people may in the future. Clark (1973) demonstrated long ago that the most profitable action to take with regard to whales is to “harvest” these slowly-reproducing animals immediately (and convert them to money in the bank). One chooses the species easiest to harvest first, then moves on to the more technologically-difficult or expensive species. In fact, this has been done with regard to many species of whales, some of which have been “converted” to money and driven close to extinction. This is happening also with rainforests. Harvested trees represent a much higher immediate rate of return than trees saved for the future. By this reasoning, only species which can reproduce themselves more rapidly than money accumulates interest should be harvested in a sustainable way. The rest should be exploited immediately for profit. This is no doubt true if one regards organisms simply as “meat” or “wood” or “foodstuffs.” There are, however, other ways to regard resources. For instance, to return to whales, they are now worth far more as objects of interest to the ecotourism industry than they are as pieces of meat and blubber, hence their “cultural” value. Whales also play ecological roles, which are very extensive and worthy, in the oceans.

ii) Resource ownership: Resources are often collective goods, without defined property rights. It may be collectively desirable to conserve the resource, but it may not be the strategy which is important to those desiring to utilize it. This is the “tragedy of the commons,” publicized widely by Garrett Hardin (1968). Consumption of these common resources must be limited if they are to be conserved, yet it is to the individual’s benefit to exploit them. It is especially difficult to exclude or limit exploitation if the resource is regarded to be of great extent (as is the case with rainforests or air or water). If the benefits from restrictions on exploitation are perceived to be less than the benefits from usage, or less than the costs for limitation, then the resource will not be conserved. However, the benefit obtained by an individual must be subtracted from the total value of the resource, since when an individual exploits it, the value of the resource for others is lessened.

iii) Uncertainty concerning future consequences of conservation/depletion actions: It is extremely difficult to predict the consequences of present actions, and, therefore, some urge that moderation in exploitation of resources is prudent. Ecosystems are dependent upon the complex of interactions among its biota for proper functioning. If (as mentioned above) ecosystem stability is related positively to biodiversity, then loss of species can lead to deterioration of that ecosystem and even to its collapse. Changes in species (such as losses, or introduction of nonnative species) can and will certainly lead to alteration of the ecosystem. The removal of even one species may lead to its doom.

iv) Specialization and competitive advantage: In the current global marketplace, there is relatively little incentive to preserve a region’s natural resources, since commodities may be obtained from other areas of the country/world, once local ones are depleted.

(The above categories are from Hanemann, 1988.)

b. On the other hand, biodiversity can have values of various kinds.

i) Biodiversity can have a commodity value; that is, it can provide some product (tangible or intangible) for the marketplace. Biodiversity has provided all of our food resources, most of our construction materials, most of our medicines – and there is always the possibility (indeed, the high probability) of obtaining more new commodities from the natural world. The component industries based on rainforests (forestry, fisheries, mining, pharmaceuticals, tourism) provide billions of dollars to the global economy.

ii) Biodiversity can have an amenity value; that is, it provides an intangible benefit for human lives. Biodiversity provides an esthetic and sympathetic basis for our lives. We engage in tourism, gardening, birdwatching, keeping pets, flower-arranging and many more activities which depend entirely upon biodiversity.

iii) Biodiversity can have a moral value; that is, a value inherent in the organism itself, regardless of the uses to which it can be put by human beings. In this context, “moral value” can also be conceived of as assigned by humans; no moral value per se inheres in species. This is the idea that humans have the responsibility to protect the other organisms on earth – from which they receive a great deal of satisfaction and esthetic pleasure. Also, cannot the moral issues place an economic value on a sustainable environment? As Pimm (1997) asked, “…would we accept child labor because the economics of employing low-paid children allows a favorable bottom line?”

(The above categories are from Dobson, 1996.)

iv) Biodiversity has an ecosystem value, as it provides all of the essential “ecosystem services” upon which our lives depend. (This is somewhat related to commodity value.)

c. If we assume that biodiversity can accrue some sort of value, how can we then assign relative valuations to different species/ecological units/ecosystems? Some species will have a considerable degree of value to humans (by one or more of these criteria); others will have less or none. Yet others have no known value that we can recognize, but may have one in the future. This is called by Norton (1988), “option value.” Obviously, an extinct species has no value whatsoever. Economists are trying to grapple with this issue. What value(s) can we assign to species (or, for that matter, to biodiversity, to ecosystems, to the entire biotic world)? Let us assume that we could calculate a value for a given species, although the calculation of such a value is beset with problems perhaps unique to living organisms.

i) If a species or ecosystem or part of one is destroyed (and thus, all its value lost), this loss cannot be reversed. Thus, one option is irreversible.

ii) Even if we could attempt to calculate a value at the present time, we know so very little about our biological world that this calculation is beset with uncertainty. We have identified perhaps 15% of the species presently existing, and know well only a small percentage of these. We cannot begin to calculate the true economic value of any part of the environment.

iii) Perhaps even more pertinent, we know that no species is an independent entity – all species depend heavily on many other species, from microbes to top carnivores, and thus any calculation of the value of one of these species cannot exclude the others. But we do not understand very much about these interdependencies, and so we have attempted to evade this problem by identifying “key” species (or “keystone” species) upon which an entire ecosystem is dependent – those species which, if lost, would cause the loss of the system.

iv) Are we even asking the correct questions? Even should we be able to make an evaluation of all species, would the value of all biodiversity be simply the sum of these values? Not at all – for not every individual of each species is the same – there is value in genetic variation. There is also a great variety of types of interrelationships among species in different ecosystems.

v) Many organisms do not have any conventional economic value.

vi) Most important, biodiversity is vanishing with unparalleled rapidity due to human activities; so that it is probably futile to attempt to value most species. They will have disappeared before we can make the most rudimentary calculations. Destroying them has irreversible consequences.

Therefore, it is wise to assume that species have value. But, as mentioned above, we don’t know which or how many species can be eliminated with impunity. At present extinction is occurring at rates far above the “background” rate (that is, the rate of species extinction which would occur even if humans did not exist). The recent elevation of extinction rates can be related to air, water and land pollution; the conversion of natural habitats for agriculture, habitations, and mines; environmental degradation, including alterations in the ozone layer, global warming and desertification, and other human-induced changes. Since extinction is occurring, and will continue to occur, we must find some criteria on which to base our evaluation. Perhaps we need not attempt to save every species; then, which ones shall we make an effort to save? Many biologists have assumed that increased biodiversity improves the functionality of ecosystems. But perhaps certain species can be let go, if we preserve the ones which are most important to the functioning of their particular ecosystem. The proponents of this view feel that, while in some cases the viability of an ecosystem might depend upon a high level of biological diversity, in other cases a few dominant species are critical, other species, less so. Thus we need to identify the species without which the ecosystem could not function. However, tropical forests are among those ecosystems which appear to be dependent upon high diversity.

Some suggest that we cannot value species singly, but that we must consider the totality of the biosphere as an economic unit. “The value of biodiversity is the value of everything” (Norton, 1988), and, “The total value [of biodiversity] to the economy is infinite” (Costanza, et al., 1997) since everything is dependent upon biodiversity. Ecosystems contribute many beneficial services which do not appear in the money system at all. Such services include clean air and water, regulation of climate, treatment of wastes, production of soil, nutrient cycling, regulation of gases in the air and water, and so on. Our treatment of the earth is like a game of Russian roulette. We don’t know which species or how many we can lose without disaster and destruction of human (and other) life on this planet.

We must recognize the value of the organisms with which we share the planet. As Costanza, et al., (1997) puts it, “We must begin to give the natural capital stock that produces these [ecosystem] services adequate weight in the decision-making process, otherwise current and continued future human welfare may drastically suffer…many ecosystem services are literally irreplaceable.” Moreover, “The conventional market operation does not provide adequate information or rewards to ensure the preservation of rare and irreproducible natural phenomena.” (Krutilla, 1973) We do not, and probably cannot, ever evaluate such services adequately, but we can value the ecosystems of the world appropriately. Many efforts have been made to estimate the value of the world’s ecosystem services; these estimates have been in the range of $33 trillion annually (Costanza, et al., 1997). Many, however, feel that ecosystem services cannot be valued, and Costanza’s paper has aroused a great deal of controversy. Michael Toman (1998), in response, stated that Costanza’s figure was “a serious underestimate of infinity.” And Pimm (1997) said, “For ecologists, prices are woefully incomplete measures of nature’s value that poorly prefigure the consequences of humanity’s exponential growth.” As our natural ecosystems become ever rarer and more disturbed by human activities, their value (economic or otherwise) may increase. “As manufactured goods become more abundant and natural amenities more scarce, the trade-off between them will progressively favor the latter.” (Krutilla, 1973)

Ehrenfeld (1988) feels that basing a conservation strategy on an economic valuation will ultimately be destructive, as it prevents mankind from considering and dealing with the basis of loss, and makes it seem as though the technological and socioeconomic factors pushing these losses were inevitable. The value of biodiversity is intrinsic and does not depend on the properties of species, the uses to which they may be put, or their role in ecosystems – the value of biodiversity IS. We must invoke values other than economic ones. The long-established existence of species gives them a right to continued existence; they evoke within us other humanistic or cultural values – such as wonder, aesthetic and recreational values, and so on (cf. Toman, above).

To summarize, we know that natural resources are extremely valuable. They comprise the sum total of our tangible wealth, and much of our intangible wealth as well. “Every country can be said to have three forms of wealth: material, cultural and biological. The first two we understand very well, because they are the substance of our everyday lives. Biological wealth is taken much less seriously. This is a serious strategic error, one that will be increasingly regretted as time passes.” – a prescient statement by E.O. Wilson (1989, p. 108). If or when we reduce biodiversity sufficiently, humans will become extinct too.