#### October 23, 2010

I've been reading the latest report from The Economics of Ecosystems and Biodiversity (TEEB) study,  which was released this week at the meeting for the Convention for Biological Diversity.  I've been skeptical as to the utility of the project, which was billed as a "Stern Report for Biodiversity" when it was begun three years ago.  Nicholas Stern's report on the economic impact of climate change could be reduced to a few numbers - the cost of mitigation, and the cost of action, tons of carbon released and its concentration in the atmosphere.  Biodiversity doesn't lend itself to such simplification.

As such, TEEB's final results resemble a review of literature more than a synthetic research study.  The latest report, actually, is really a synthesis of interim studies already released.

However, I think TEEB's findings and recommendations will likely impact policy more than the sum of its parts could.  This is partially because of the communications savviness of its team.  The report is an easier read than most of the news articles covering its release, and light-years beyond most committee-written technical reports in clarity and quality.  The project's leader, Pavan Sukhdev, has shown himself to be an eloquent and charismatic communicator.  TEEB, unlike Stern, released draft reports targeted at different stakeholder groups in order to generate buzz and feedback, and recently launched a slick web media campaign.

As the TEEB report itself points out, its "recommendations are aimed far beyond the remit of most environment ministries and environmental institutions," so the focus on outreach to other groups and the public makes a lot of sense.  (This is an improvement over the failures of the IPCC, which as Rebecca Lutzy noted, had zero public communications staff when Climategate "broke.")

The other thing that struck me about the report was the emphasis on the limits, risks, and complexities quantitative economic approaches.  Some news accounts of TEEB have focused on the cited figures of $2-$4.5 trillion lost annually in global natural capital.   The report, though, de-emphasizes such numbers, saying,

Estimating the costs of biodiversity loss at a global scale remains a controversial and complex undertaking, and the resulting numbers should be used with care....

Valuation is seen not as a panacea, but rather as a tool to help recalibrate the faulty economic compass that has led us to decisions that are prejudicial to both current well-being and that of future generations....

It first needs to be stressed that valuation is best applied for assessing the consequences of changes resulting from alternative management options rather than for attempting to estimate the total value of ecosystems....

Monetary valuation of biodiversity and ecosystem services may be unnecessary, or even counterproductive if it is seen as contrary to cultural norms or fails to reflect a plurality of values....

The synthesis report instead focuses on a framework of recognizing, demonstrating, and capturing value from ecosystems.  Quantative valuation and market based mechanisms are held up as a subset of many tools available for protecting ecosystems.  I think this approach actually makes economic approaches more appealling; by awknowledging their limitations, we can better apply them in the contexts that make sense.

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