What’s A Marsh Worth, Anyway?
Venkataraman Ganesh, reporting from the United Nations General Assembly – Economic and Social Council (UNGA-ECOSOC), ponders over the dilemmas associated with environmental protection and valuation.
A view of Pallikaranai Marshland in Chennai | Photo Credits: M Karunakaran, The Hindu Public debates about environmental protection have a tendency to get polarized with environmentalists on one side and businessmen and capitalists on the other. Environmentalists raise a hue and cry the moment anybody announces a project that disturbs/destroys the natural environment. Trees being cut down for road widening, marshland being drained for housing and air being polluted for industrial activity - these and more elicit their harsh criticism. Businessmen and capitalists, on the other hand, speak of ‘development’ and the ‘greater good’. Any sort of environmental damage is seen as unavoidable collateral, and a dichotomy is created between environmental protection and development. Which side is right? What would be the sustainable approach?
To answer these questions, it is important for us to understand the problem that lies at the heart of this dichotomous debate: the question of environmental valuation. One can easily evaluate the net-worth of a company by going through the company’s balance-sheet; the economic strength of a country can be calculated by using measures such as the Gross Domestic Product (GDP). However, how does one value a tree? What’s a marsh worth anyways? Valuation of these environmental goods is important if one wants to make a meaningful comparison between them and marketable goods like chocolates and cakes - what is needed is a method to value environmental goods in terms of rupees and dollars. It is here that environmental economics comes into play. Environmental economics has devised a number of methods and tools to valuate environmental resources, but at the heart of these is the fundamental principle of null-jointness between environmental goods and marketable goods . The principle of null-jointness, in this context, states that it is impossible to produce a marketable good without producing some amount of environmental bad. Similarly, it is impossible to create some environmental good without creating some marketable bad. In this way, environmental economics rejects the dichotomy between the environmental protection and development, maintaining that it is necessary, and indeed possible, to find a balance between these two extremes. This is of profound importance to policy-makers, especially in light of the Sustainable Development Goals (SDGs).
The SDGs, on close inspection, can appear to be contradicting one another. To give an example, Goal 8 of Agenda 2030 talks about ensuring ‘Decent Work and Economic Growth’ while Goal 13 talks about taking action against climate change. How are we to reconcile factories that emit carbon-dioxide and provide employment with reducing carbon footprint? The answer is that we don’t, at least not entirely. It is indeed true that generating employment while maintaining zero carbon foot-print is near impossible, but this must not prevent us from striking a balance between these two objectives. It is possible to achieve sustainability by striking a balance - all that is needed is the will to do the same.
Scientists and economists have come up with a number of broad principles which, if followed, can ensure sustainable economic growth. One such principle is the Shadow Project approach. The Shadow Project approach states that whenever a project or an action uses up some amount of natural resources in one place, we can ensure sustainability by ensuring that we create some sort of natural resources in another location that shall offset the loss caused by our project or action . Another principle that has been devised to ensure sustainability is the Safe Minimum Standards (SMS) approach . To understand the SMS approach, let’s assume that we need to engage in some construction activity near a wetland. According to the SMS approach, some percentage of the wetland must be retained and protected to ensure that the wetland ecosystem is not destroyed beyond its regeneration capacity. This shall ensure that a balance is struck between protecting the wetland ecosystem and ensuring economic activity.
Important questions remain though. Who decides how much natural resources we must create? Who decides what the minimum standards are? How will the decision makers arrive at the decisions? There seem to be no easy answers to these questions. However, one thing is clear: realizing sustainable development must necessarily confront and tackle these questions, and people must work together, cutting across disciplines, genders, ethnicities, and nationalities to find answers. Our survival depends on it.
