Yesterday I had the misfortune of taking the family minivan to the shop to get the brakes checked. Turns out the anti-lock brake module is bad and needs to be replaced. The bill? $1130. Now the minivan is 8 years old and has almost 90,000 miles on it. So we asked ourselves the obvious question: Is it worth $1130 to repair the van. After careful cost/benefit analysis, we decided, yes, the value of repairing the van is at least that much, to us.
Now I know you're asking what the hell does this have to do with the environment. Read on for another in our long line of unprovoked attacks on ecological economics...
As I was yelling at my kids and kicking the dog* over the prospect of spending $1130 on a piece of sh!t van, I thought of a similarity between car repairs and assigning economic value to the environment.
In debating whether to go ahead with the repair, my wife asked: "What happens if something else goes up on the van next month and we owe another $1,000? If we keep adding up the repairs, the total will be more than what the van is worth." Or something like that.
Completely ignoring the question at hand, I zoned out and thought: Wait a minute, that's exactly the problem with trying to use values for individual environmental events to assign values to entire ecosystems. I think in italics.
An ecosystem is made up of a bunch of parts, just like a car. We can figure out what each part is worth by figuring out the willingness to pay for repairing each part in isolation. I'm willing to pay $1,130 to fix the ABS module. I'm willing to pay $400 to replace the tires. I'm willing to pay $200 for new shocks. I'm willing to pay $1,000 to fix the transmission. But I'm not willing to pay $2,730 for the car as a whole. Why? Because adding together values derived in isolation doesn't give you a total value.
And that's one problem with trying to take a bunch of individual environmental valuation studies and adding them together to get a value for an ecosystem. For the same reason that a car is not worth the value of the sum of all of the possible repairs to individual parts, an ecosystem is not worth the sum of fixing all of it's parts. Just another in a long line of reasons why the ecological economists favorite number--$33 trillion per year--is bogus.
Yep, I think that makes sense.
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*OK, I'm taking literary license here. Really, we don't have a dog...so I went out and kicked the neighbor's dog**.
**Calm down, I'm joking.
