Bio1110 Chapter 4 Environmental Economics and Consumption
  1. Our Earth consists of interlinked systems that interact in complex, multifaceted ways, and provide valuable ecosystem services that are worth preserving.
    • • Environmental resources provide valuable ecosystem services - for free.

      If natural environments remain intact, these resources are sustainable: they can continue to provide such services indefinitely.

      The most valuable service is cycling of nutrients.

  2. Human impact on the environment can be estimated by the ecological footprint which is primarily affected by the IPAT equation.
    • • The ecological footprint is the land area needed to provide resources and manage wastes of a person or population.

      This is usually much bigger than the footprint physically occupied by the individuals.

    • • The U.S. per capita ecological footprint is 24 acres.

      With a population of 300 million, total U.S. footprint is 7.2 billion acres, about 3.6 times our physical land area.

      China currently has a smaller per capita ecological footprint of 2 acres.

      China's population of 1.3 billion yields a total Chinese footprint of 2.6 billion acres, which also exceeds their available land.

      Both countries have exceeded the biocapacity of their environment.

      If everyone lived like an American, we would need more than 6 Earths to support the 7 billion individuals.

    • The biocapacity of a region is its long-term ability to support organisms.
      2008 data from the Global Footprint Network show that world ecological footprint of 2.6 hectares per person was already above the biocapacity of 1.6 - a deficit of 1 ha.
      High-income countries (such as those in North American and the European Union) are in higher deficits.
      South America is the only major region that has a significant biocapacity reserve of 4.5 ha.

    • • The environmental Impact of a Population is proportional to its Affluence and the Technology that supports that affluence: I = P x A x T.

      Note that as Technology improves, that factor becomes smaller and may eventually become less than one, so that high-technology may reduce the Impact of an affluent population.

  3. Much of our goods and services contain hidden costs that are passed on to society and future generations.
    • • The true cost of a consumer item such as paper includes

      1. Internal costs such as raw materials, labor, rent, that are calculated into the consumer price.

      2. External costs such as depletion of resources, pollution, degradation of the environment, that are hard to calculate but are shared among all humans and other organisms.

      Traditional economic models assume a linear system of resource usage.

      A sustainable economy should consider closed-loop system that includes external costs.

    • • A linear (one-way) system assumes resources are limitless and wastes are negligible.

      However, resources eventually will become depleted and wastes will reach toxic levels.

    • • A closed-loop system attempts to manage resources utilization and minimize wastes.

      For sustainable use, renewable resources ensure long-term availability, and wastes are reduced/reused/recycled.

  4. Smart management of our ecological capital helps preserve natural resources.
    • • Just like money in the financial sector, our ecosystems are a wealth of natural capital.

      The yearly "interest" is the rate of growth of that capital.

      This capital is sustainable if our annual "withdrawal" does not exceed the interest.

      The capital is not sustainable if we withdraw more than the interest; the capital decreases over time.