Ecosystems as Natural Assets

An important contribution of natural resource economics has been to treat the natural environment as a form of capital asset. The more recent literature on ecosystem services implies that these environmental systems can also be viewed as natural assets that produce a flow of beneficial goods and services over time. Ecosystems as Natural Assets explores this literature and related modeling to show explicitly how the concept of ecosystems as natural assets translates into the traditional "natural capital" approach of resource economics. In Ecosystems as Natural Assets, the author uses ecological landscape, or land area, as the basic unit, therefore modeling the ecosystem as a natural asset is relatively straightforward. The approach is to adopt a much simpler model of land use change. Chapter 2 discusses ecosystem services and ecological landscapes as the basis of representing ecosystems as a natural asset. Chapter 3 develops the basic natural asset model of an ecosystem by employing the competing land use model. Chapter 4 begins by returning the example of coastal landscapes and discusses ecological evidence that the basic functions of these systems are spatially variable. Chapter 5 revisits the basic natural asset model of competing uses of an ecological landscape and extends it to an open economy setting. Chapter 6 extends the basic model to consider the problem of ecological collapse, and shows that more of the ecological landscape will be preserved compared to when the threat of collapse is absent. Chapter 7 presents the conclusions.