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Who can put a price on nature?

22 January 2018 Center for Development and the Environment, UiO, Norway

- Economic calculations are not indisputable, says Head of Research Desmond McNeill. Very few politicians understand the methods economics use to calculate the price on nature, and the many valuations they are built on.

On March 23, 1989, Exxon Valdez ran aground on the coast of Alaska. 33 000 tons of crude oil poured out. Over 2,000 kilometres of coastal land was destroied. The company Exxon Shipping was sued and had to pay restoration expenses, but what should be the price on nature?

Why does everyone listen to economists?

Policy-makers base their decisions largely on calculations made by economists. But the details of the techniques that economists use are not generally understood; and estimated values, based on calculations by reputed economists, can vary by a factor of 100 or even 1,000 times.

Why, then, do economists exercise such power? To explore these issues, this article begins with an analysis of the techniques that economists use 127 to put a money value on time, on human life, on the ‘environmental services’ that nature provides, and on the significance attached to future generations. These examples are then used to draw some conclusions about how and why the expert knowledge of economists exerts such power in modern society.

Attached files

  • Exxon_Valdez_Oil_Spill_(13266806523)

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