This chapter is something of a "thick" essay on the emerging field of "Ecological Economics."

Costanza argues that this is a "transdisciplianry" field that integrates, at least, resource economics and ecology.

You can get a feel for how he sees the differences between traditional ecology and economics and ecological economics in Table 19.1: examine the differences, and put in context of the other topics we have covered. We’ll discuss briefly in class.

• Time frame: must cross time

• Space frame: must be multi-scaled

• Species frame: must encompass suites of species.

Costanaza’s critique: (p. 329) most env management and resource management reflects local goals, short-term goal, and single-focus goals. This would be OK is such behaviors added up to an overall (global) sustainability, but Costanza says that they don’t. Here he is arguing for a holistic, whole systems approach, and arguing, essentially, the sum of the parts may yield a non-functional whole.

"social traps" - - what are local examples?

Ecological systems as "best" model for sustainable systems.

This brings up a larger epistemological question: what is the model for a sustainable human system? How far can we take organic models (like, say, food chains) and apply them to social systems (e.g., industrial supply chains). I’m more skeptical than Costanza, that ecosystems offer a model for organizing sustainable human systems, but let’s discuss it.

Costanza goes a bit further than Loomis in arguing for alternative measures of recognitions of ecological value.

He uses:

Natural capital, defined as ecological goods and services.

These are: long-term in nature; not traded on markets; and, newer idea here: information about their status, which should be reflected in their value, is poor.

He briefly reviews willingness to pay approaches, then discusses:

"contingent referenda": taxes, referenda like open space taxes and programs, etc., which reveal people’s valuation of intact ecosystems better than WTP.

Energy analysis: the actual energy needed to create the good or service. Energy input can be converted to dollars, and we can compare, say, grazing cows on a natural grassland to a feedlot where they are fed cultivated corm.

GNP is the most widely used accounting for a nation’s wealth and economic flows, but it ignores natural capital (and its degradation: he tells the tale of the Exxon Valdez oil spiull that actually increased GNP –and probably the gross state product of Alaska---while actually degrading the stock and flow of natural resources.

Index of Sustainable Economic Welfare (by Daly and Cobb), decrements GNP for environmental degradation, like oil spills and the costs f cleaning them up.

Costanza briefly (and poorly) describes a form of ecological network analysis that allows ecosystems to be included in econometric input-output analyses. This is where Loomis was heading at the end of his chapter, but neither are very clear about how to do it—and we’ll not get into it.

Then lays out policy and institutional changes needed to arrive at a sustainable ecological economics: