The Economics of Environmentalism

What’s the value of a forest? Is it in the wood that can be used for construction or paper making? Or the campers and hikers it draws? Or some other environmental advantage all those trees in close proximity provide? Around the world, there are governments, organizations and companies starting to look more closely at the value of natural resources beyond their short-term value – such as logging forests for lumber. Oregon State University professor Jane Lubchencho calls says the approach requires viewing nature as form of economic capital. By assigning a dollar figure to all of the value nature provides, communities can create better economic incentives to preserve it. She spoke with James Perkins of our staff about this concept of “natural capital,” which she recently wrote about in the Proceedings of the National Academy of Sciences.