Gross Ecosystem Product or GEP: the value of nature

Gross Ecosystem Product or GEP: the value of nature

Gross Ecosystem Product, or GEP, tries to take into account nature's contribution to the economy.

Gross Domestic Product: GDP is a simple way to describe the health of large and complicated economies. And for the past century, the goal of many countries has been to increase their GDP. But focusing only on GDP has had some downsides.

"By growing the economy, we have destroyed, as an unintended consequence, parts of nature, which are also important to our well-being."

Stephen Polasky, an environmental economist at the University of Minnesota, and his colleagues have created a new measure: Gross Ecosystem Product, or GEP.

“So that we really have metrics that tell how we are doing in the management of ecosystems, the management of nature, and not only for the good of nature, but how that is returning and influencing our own well-being. So really GEP is trying to say what is nature's contribution to the economy. In a parallel way to what the GDP does when measuring economic performance ”.

Calculating the economic value of timber and fish is fairly straightforward. But other benefits of a healthy environment may be less obvious. Insects pollinate crops. Intact rivers improve water quality and buffer downstream cities from flooding. Thriving ecosystems attract tourists who spend money.

“And part of the problem here is that it's hard to put a price on some of these things. Some people even say, well, they are priceless. Unfortunately, what it means in practice, "priceless means that it has zero value in many of the calculations."

Zero value in GDP, but not in GEP. For example, Polasky and his colleagues calculated the figure for Qinghai, a province in western China. They found that the Gross Ecosystem Product exceeded GDP in 2000, and equaled three-quarters of GDP in 2015. During that period, the GEP increased by 127 percent, thanks to extensive restoration efforts and increased value. of the water. The results are in theProceedings of the National Academy of Sciences [Zhiyun Ouyang et al, Using the gross ecosystem product (GEP) to value nature in decision-making]

The researchers focused on Qinghai because it is one of several provinces where the Chinese government is experimenting with the use of GEP as part of its formal decision-making process. For example, GEP can help officials weigh the pros and cons of potential projects, such as dams. Or it can be used to show whether local leaders are taking care of the environment and not just expanding the economy.

GEP could also serve as the foundation for programs that pay residents to be good stewards of natural resources that benefit themselves and others. In Qinghai, such a program could work for water: the province is where the Yellow, Yangtze and Mekong rivers originate, and its waters support cities and farms across Asia.

Polasky says his work is just a first step, and he hopes GEP will refine itself over time. But he says we have to start somewhere.

"If we are really going to have a sustainable civilization, then we have to pay attention to infrastructure, basically the essential things that nature does for us, and not continue to take it for granted."

Video: What Is Natural Capital? (October 2020).