An Ecological Economics Approach
Edited by R. Kerry Turner, Jeroen C.J.M. van den Bergh and Roy Brouwer
Chapter 4: The Economics of Wetland Management
R.K. Turner, R. Brouwer, T.C. Crowards and S. Georgiou 1 INTRODUCTION According to Samuelson and Nordhaus (1985), economics is the study of how people and society end up choosing, with or without the use of money, to employ scarce productive resources that could have alternative uses – to produce various commodities and distribute them for consumption, now or in the future, among various individuals and groups in society. In other words, economics analyses the costs and benefits of improving patterns of resource use. Because limited resources are available to satisfy multiple social needs, resources have to be distributed as efficiently as possible to ensure maximum benefit to society. Given the fundamental preoccupation with scarcity, economics defines the conditions required to secure the most efficient allocation of scarce resources in a variety of contexts. Conservation of wetlands will be associated with opportunity costs, which are the benefits forgone from possible alternative uses of the resources that are essential to continued wetland functioning. On the other hand, going ahead with these alternative activities results in the opportunity costs of forgone benefits that would otherwise be derived from the wetland. Quantifying these benefits in a way that makes them comparable with the returns derived from alternative uses can strengthen the case for conserving wetlands and improve public decision-making (Balmford et al., 2002). Cost–benefit analysis (CBA) is carried out in order to compare the economic efficiency implications of alternative actions. The benefits from an action are contrasted with the associated costs (including the opportunity...
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