Environmental economics (or ecological economics) assigns economic values to species, communities and ecosystem. There can be Direct and indirect economic benefits of biodiversity
Direct benefits
Direct economic benefits or
commodity values, are assigned to the products
harvested by people.
Direct economic benefits of biodiversity
A) Food supply Biodiversity provides high variety of food : crops , livestock , forestry, and fish are important food source of human species. However the number of species have been domesticated and cultivated are small if comparing with the number of species existing.
According to the Food and Agricultural Organization of the United Nations, humans currently cultivate only 150 plant species, and just a few provide over half of the food we eat. Just 15 animal species make up over 90% of our livestock.
Monocultures (large-scale cultivation of single varieties of single species) are extremely vulnerable to disease. A water mold caused the Irish potato famine where potatoes had been bred from a single Incan variety.
Potential for hybridization requires a diverse “bank” of wild, native species. Contemporary breeders increase genetic diversity by hybridizing crop species with wild species adapted to local climate and disease.
The control/wild species can be used to protect the crop against pest and weeds . The economic loss due to the loss of crops/ food can be reduced with the use of the control species.
B) Clothing, shelter and other products As around 40,000 species of plants, animals, and fungi provides us with clothes, shelter, and other products like timber, skins and furs, fibers, fragrances , papers, silks, dyes, poisons, adhesives, rubber, resins and more.
C) Medicine and medical models . According to American Museum of Natural History Centre for Biodiversity Conservation ; 57% of most important drugs come from nature, yet only a fraction of species with medicinal potential have been studied.
The Rosy Periwinkle (A) is the source of two chemotherapy drugs effective against leukemias. The mold Penicillium (B) produces the antibiotic penicillin to inhibit competing microorganisms. Aspirin originates in the bark of the White Willow (C) several species of tropical frogs in the genus Phyllobates (D) produce poisons used by South American tribes for hunting with darts.
D) Biomimicry, also known as biomimetics or bionics, uses organisms for engineering inspiration and human innovation. Rattlesnake heat-sensing pits, for example, suggested infrared sensors. Zimbabwe’s Eastgate Centre incorporates air-conditioning principles from termite mounds. The 2006 Mercedes-Benz Bionic employs the body shape of the yellow box fish to combine high internal volume and efficient aerodynamics. Only 10% of current technology employs the highly efficient biological designs crafted by evolution and natural selection. Loss of biodiversity is the loss of millions of years of evolutionary wisdom.
Indirect Benefits of Biodiversity
Indirect benefits are provided by biodiversity that do not involve harvesting or destroying the natural resource. Such benefits include ecological benefits such as soil formation, nutrient cycling, waste disposal, air and water purification, education, recreation, future options for human beings, etc.
Indirect Benefits can be further sub-divided as:
A) Increasing ecosystem productivity : Ecologist David Tilman compared grassland plots to show that increasing species diversity increased overall productivity (yield). Different plants utilize different resources, so a variety of plants may more completely use resources within an area. As noted above, diversity also reduces system vulnerability to pests and disease.
B) Increasing ecosystem stability Tilman observed his grassland plots through several cycles of drought and documented a similar relationship between biodiversity and stability. Plots which were more diverse were more resistant to drought and later recovered more completely. Reducing ecosystem vulnerability to pests and disease may also be a factor in the relationship between diversity and stability.
C) Maintaining the atmosphere Plants and algae produce the oxygen which makes up 20% of the atmosphere essential to aerobic organism, and remove carbon dioxide produced by respiration and burning fossil fuels. Oxygen is also critical to life because it helps to maintain the ozone shield , protecting life from dangerous Ultra- violet radiation.
D) Maintaining soils Soil microorganisms maintain nutrients in complex but critical chemical pathways. Vegetation and litter prevent erosion of soils which require thousands of years to form. Estimates suggest that erosion destroys as many as 3 million hectares of cropland annually, and that as much as onefifth of the world’s cropland is “desertified” through salination, acidification, or compacting.Plants helps to prevent soil erosion. They also improve soil quality when they decompose. Microorganism purifies water in rivers and lakes. They also return nutrients to the soil.
E) Maintaining water quality Water treatment plants rely in large part on microorganisms for water purification, and natural systems do the same. In nature, wetland, waterway, and watershed root systems combine with soil adsorption and filtration to accomplish water purification. When New York City decided to restore the Catskill watershed, their $1-1.5 billion investment in “natural capital” contrasted favorably with the $6-8 billion initial cost and $300 million annual operating cost of a new treatment plant.
F) Fixing nitrogen One of the most amazing aspects of biological systems on earth is their absolute need for nitrogen – to build the proteins and nucleic acids upon which life depends – and their nearly universal dependence on microorganisms to “fix” atmospheric N2 gas and recycle the nitrogen of waste and death. Only after the bacterial “service” of processing nitrogen is it available in usable chemical form to plants, and through them, to animals.
G) Nutrient recycling and waste disposal: Bacteria and nitrogen are not the only contributors to the waste management services of ecosystems. Fungi, protists, and scavengers help to decompose waste and dead organisms so that new life can reuse the available nutrients.
H) Pest and disease control : According to the AMNH-CBC, farmers spend $25 billion annually on pesticides, while predators in natural ecosystems contribute 5 to 10 times that value in pest control. Costs associated with the use of chemical pesticides (such as water pollution) add to the value of natural pest control. Natural enemies are adapted to local environments and local pests, and do not threaten each other’s survival as do broadspectrum chemical pesticides. Preservation of natural enemies is associated with preservation of plant diversity, as well. Disrupted ecosystems can lead to increasing problems with disease. In Africa, deforestation has led to erosion and flooding, with consequent increases in mosquitoes and malaria.
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