Heterodox Economics and the Biodiversity Crisis

Economists must engage with environmental issues such as the biodiversity crisis and heterodox economics provides a more fruitful set of tools than the orthodox approach for doing so. Biodiversity refers to the variability of living organisms at the genetic, species and ecosystem levels and the ecological complexes or interdependencies between species (MEA 2005; DEST 1996: 1; OTA 1987: 3). Through our economic activity, humans have reduced biodiversity to the point where it can be classified as being at crisis-point. For example, there have been 100 well documented extinctions of birds, mammals and amphibians over the last 100 years; and the extinction rate is 100 to 1,000 times the extinction rate experienced without human influence (MEA 2005: 3-4). In Australia, a biodiversity hotspot, 27 of approximately 350 native mammals have become extinct since European settlement (Department of the Environment, n.d.). Across all taxonomic groups there has been a decline in population sizes and/or ranges for the majority of species (MEA 2005: 3) and 10-50% of mammals, birds, amphibians, conifers and cycads are threatened with extinction (MEA 2005: 4). Genetic, species and ecosystem diversity has declined substantially at a global level and species interdependencies have been compromised. These losses impact directly and indirectly on human wellbeing. Directly, biodiversity contributes provisioning, regulating and cultural ecosystem services (MEA 2005: 5). Provisioning services refer to the food, raw materials, and medicines provided by in situ species. Regulating services refer to pollination activities and biological controls needed for modern agriculture, along with the carbon sequestration and storage needed for human existence. That is, as part of the carbon cycle, plants convert unbreathable carbon dioxide into oxygen and a significant reduction in the number and abundance of plants would make life on Earth untenable. Cultural services refer to aesthetic appreciation and inspiration for art and recreation. Indirectly, by increasing the resilience of ecosystems, biodiversity underpins ecosystem services (MEA 2005: 5), such as local climate and air quality regulation, waste-water treatment, prevention of erosion and the maintenance of soil fertility, as well as the production of new medicines and agricultural products (TEEB, n.d.). The identification of the biodiversity-loss problem as a 'crisis' derives from the recognition of threshold effects or tipping points. For example, Ehrlich and Ehrlich (1981), in their rivet popper metaphor, liken ecosystems to an airplane held together by thousands of rivets (species). If just one rivet is popped (one species becomes extinct), the plane is weakened but it will probably not fall apart. However, after many rivets are popped a tipping point is reached and one more popped rivet leads to the destruction of the plane. This metaphor highlights the fact that biodiversity is subject to sudden, non-linear changes or abrupt regime shifts that result from a gradual weakening of the system (MEA 2005: 6). Thus, there is a biodiversity 'crisis' because biodiversity is exceedingly valuable to humans, extinctions and population reductions continue at an alarming rate, and a threshold effect could result in mass extinctions. Far from being a neutral input that guides ecological policymaking, economic understandings of biodiversity influence policymaking in ways that may be counterproductive to the kinds of holistic decision-making processes needed for effective conservation practices (Robertson and Hull 2001). It is, therefore, critical to scrutinise the manner in which biodiversity is represented in prevailing economic epistemologies, as this affects not only the way biodiversity is perceived and understood, but also how it is implemented in policy, management and conservation practices. Many of the policy tools used to manage the biodiversity crisis derive from orthodox economics. …