Quantifying the Value of Natural Capital and Ecosystem Services
Ecosystems provide numerous direct and indirect services to humans via their capture, transformation and export of energy, water, and nutrients. A select list of ecosystem services includes climate regulation, hydrologic processes, air quality regulation, pollination, soil fertility, biomass production, biodiversity production, and water quality protection. The list goes on. In short, ecosystem processes are the repository and source of real wealth in the sense that they provide the goods and services upon which we depend, and for which we do not pay.
Indeed, it is the fact that we do not pay for ecosystem stocks (soil, water, fish, forests, diversity) and services (carbon sequestration, water purification, microclimate regulation, ecosystem stability) that is both the root of our material wealth, and the source of global ecological decline. In the modern era, humans have co-opted "free" (i.e., non-market) ecological services to match the high quality energy tapped in the form of fossil fuels, from which we have generated tremendous financial and social captial. The recognition that the natural capital that forms the basis of that wealth creation is in peril forces humanity to make better decisions about how we allocate the free and often indirect services that we obtain from natural resources.
There have been numerous efforts to try to link human wealth to the real resources of the ecological system from which that wealth is derived. The French Physiocrats and the contemporary Ecological Footprint research focus on the land requirements and equivalents for the various aspects of modern industrial economic metabolism. Others have chosen to retain the nomenclature of the economic system and estimate the monetary value of ecological processes both directly and indirectly. Still others rely on public preference to set values, and quantify the value of environmental services based on the public willingness to pay for their protection or willingness to accept their decline. Still another method derives from basic thermodynamic theory, and uses energy as a the bas
