An interesting fact I learned: An intact mangrove forest is worth more than a shrimp farm.
I don't mean this ethically, although an intact mangrove forest is of course worth more than a shrimp farm from an environmentalist point of view. I mean ... economically, the mangrove forest is worth more. The kicker is that this value is both indirect and 'invisible' (more on that in a moment).
Our professor showed it to us like this. A hectare of shrimp farm is -- from the direct, economic point of view -- worth a net value of $2,000. From this traditional point of view, the only thing you can do with a hectare of mangroves is to cut it down, yielding timber worth $90. Clearly, the only economically sensible activity is to hop down the mangroves and convert them to shrimp farms post-haste.
Follow me over the fold to find out why that's not quite true...
Here's where the indirect costs and benefits come in (I'll explain why I call them invisible later).
First, of course, is the value that an intact mangrove forest provides through services. Mangroves are incredibly valuable to the fishing industry, of all things -- they provide a safe harbour and nursery for the young fish. That alone is worth $70 per hectare. They also trap sediment, filter out and break down pollutants, and prevent erosion. On top of that, they protect inland areas from natural disasters. (The Millenium Ecosystem Assessment of 2005 found that villages shielded by intact mangrove forests had significantly fewer casualties in the Boxing Day Tsunami than those which had either cut their mangroves down or had seen their forests invaded by non-mangrove species. That said, there are studies saying that mangroves had no impact on wave severity -- so jury's out on that point. But the others still hold.) Taken together, these raise the value of a mangrove forest to around $3,600 per hectare.
Now let's take a look at the shrimp farms. As it turns out, shrimp farms are hugely subsidised -- something I get the feeling is true of many industries. Take away the $1,700-per-hectare subsidy, and then take away the $230 of pollution costs, and the shrimp farm is worth less than even the timber value of the mangrove forest!
Now, I freely admit that I'm no economist, so feel free to correct me if I get something wrong here, but I think I can see where this incredibly non-intuitive system comes from.
Essentially, in an entirely human-driven economy -- no outside ecological input -- everything is 'visible' to the system. If something needs to be done, then you need to pay people to do it, and you probably need to pay for materials and/or infrastructure as well. Direct human actions are therefore visible to the system. I don't know if indirect effects are as common here as they are in ecology, or if those effects are factored in when making economic decisions, but I'm willing to bet that they are.
The flip side of the system, though, is this: It only sees people. Natural processes are invisible to it.
Why? Because natural processes don't draw wages. Building and running a sewage treatment plant is expensive, but if you just dump it all into the nearby marsh, well, that's free! The ecosystem in the marsh will break down the waste; maybe organisms will even adapt locally to more efficiently handle the influx, but the economy can't 'see' any of that because there are no humans involved.
Then people look at the marsh, observe that they can't build or plant or graze livestock on it, and decide that it is worthless as it is and must be drained.
Not so. It's worth as much as an operating sewage treatment plant is. And if that's where the city's water comes from, it's worth at least some of what a water treatment plant costs. And thanks to the constant influx of nutrients, it probably contributes to maintaining a flourishing local ecosystem; maybe even ensures a healthy abundance of fish. Heck, it might even be mitigating the Urban Heat Island Effect.
But economics doesn't take any of that into account.
If there are protests, they are likely to be on the grounds that birds and flowers would be driven out. Don't get me wrong; I find maintaining nature to be an excellent moral argument. But something being morally right doesn't make it fiscally stupid, and in the current climate, the economy is touted more than ecology.
Money talks. Right now, it appears to be talking while deaf in one ear.
Then it wonders why its sums are coming out wrong.
(If anyone wants specific references for anything, I can provide them.)