There are several reasons to place an economic value on biodiversity. Putting an economic value upon biodiversity, with its component species, doesn't negate all other ways biodiversity might have value to different people: spiritual, psychological, ethically etc. By putting a monetary value on the species doesn't mean that nothing else is used to influence the decision to save a species from extinction or not. Indeed, sometimes it is decided upon by society and/or the scientific community at large that it is imperative to save a species, regardless of what economic benefits are attributed to the species.But economic cost can still be an issue, as society always strives for the least-cost course of action that achieves the policy goals. In this case, a cost-effectiveness study might be more appropriate than a cost-benefit-analysis (CBA).
Still, it's important to know the economic value of various species existence and the potential costs if the species becomes extinct, as all forgone benefits become costs. Only thing is, these costs of lost benefits are permanent once the species is gone. So here are some valuation methods to help identify the most valuable species using cost-benefit analysis and/or the most efficient way to protect them, using cost-effectiveness studies. Only by incorporating these tools can you hope to effectively protect biodiversity, since you're able to see the incentives and disincentives that face those who are endangering a species' habitat and survivability.
Aesthetic Non-Use and Use Values
In many peoples minds, when they think of biodiversity and threats to it to conjure up images of endangered pandas and seals.This is the aesthetic value of species, in which people relate to the more charismatic, personified species like a cute koala bear,a powerful elephant, or the noble lion. These are non-use or existence values that people obtain from just knowing the species survives. There is also a related use value people get when they go on sight-seeing tours or wildlife safaris, when they directly experience the benefits of biodiversity for themselves.
Presently, over 400,000 species are either put to use by humans or whose natural ecological niche humans take advantage of for their gain.These include everything from predators that keep pest populations in check to livestock to cash crops to animals who provide fiber for clothing to bees that pollinate crops.
Recently, there has been an influx of venture capital investment in finding and mapping genetic resources in different species that could have applications in agriculture.There has also been a great deal of business activity in finding the next generation of medicines in various plant and animal species. Both of these flurries of activity have been substantial enough to warrant a label on the business: bio-prospecting. Instead of prospecting for gold, these entrepreneurs are hoping to capitalize on a traditional medicinal herb or the gene code of a certain strain of wheat that makes it disease- or climate-resistant. Mathematically speaking, bio-prospecting might lead to very low values for individual species since it's usually only a few species that can be beneficially utilized. The business trend of bio-prospecting is at least having good PR effects in the business and environmental advocacy worlds.
Ecosystem Service Values
As mentioned in the Valuation section, ecosystems provide invaluable resources to the sustainability of life on Earth. Among these services are nutrient cycling, water purification, and acting as a waste sink. Just one example of the value of ecosystems is the important role wetlands and coral reefs play in protecting coastland from storms.
Such ecosystems as these are made up of their component resident species and their natural environment. Some of these ecosystems have built-in redundancies, so they can withstand species loss, while others are more fragile. What is key, is how crucial the role of the individual species has in its ecosystem and whether its survivability is high or low. See, just like ecosystems some species themselves are more hardy, while others are not. Plus, the fewer the close substitutes present for it within the ecosystem, the worse its loss represents for the local ecology.
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