Dialogues for the Common Good: Interview with Sir Partha Dasgupta on the Economics of Biodiversity: The Dasgupta Review

Below you find a slightly edited transcript of the Dialogues for the Common Good discussion with Sir Partha Dasgupta, the Frank Ramsey Professor Emeritus of Economics at the University of Cambridge, United Kingdom. In this episode we talk about his recent publication “The Economics of Biodiversity: The Dasgupta Review“, which is the final report to the HM Treasury. You can find the original podcast here. and you here can also download a pdf version of this dialogue.

(date of the interview: July 2021)

It provides me with immense pleasure to have Sir Partha Dasgupta here on today’s episode of Dialogues for the Common Good. Partha is the Frank Ramsey Emeritus Professor of Economics at the University of Cambridge, United Kingdom. During his career Partha has worked on a variety of topics, mostly related to the economics of the environment, development and population. I would say that one can rightly claim that his work on resource economics has become the foundation for the way in which economists today approach the problem of resource extraction. His work on inclusive wealth together with, for example, Kenneth Arrow, is the foundation of what governments are using to evaluate whether their countries are on a sustainable growth path. Partha has also extensively worked on the optimal population size and is among only a handful of economists who dare to address that problem. It is fair to say that Partha is one of the pioneers, if not the pioneer, of the nexus on environment, development and economics and he has influenced both our profession and policymaking to an extent few others have.

In addition to all of this, you have recently published a ground-breaking report called The Economics of Biodiversity: The Dasgupta Review. For our viewers who are not familiar with the report, could you briefly state what you view as the main takeaway message of the report?

I was asked to prepare a review of the economics of biodiversity, which didn’t really exist as a subject or at least not in a qualified forum. I had no doubt in my mind that I would accept the invitation from the Chancellor of the Exchequer of the UK government in April 2019. I said yes, immediately, because I felt I was prepared for it. I’ve been working on related problems for about 40 years. However, pretty quickly, I realized that I wasn’t going to write on the economics of biodiversity. Biodiversity is a characteristic of ecosystems. What I realized was that I was going to be writing the economics of the biosphere, the entire biosphere. The units, or the conceptual basis of the review, are ecosystems, which are durable capital assets subject to depreciation. If you mistreat an ecosystem, then  it deteriorates in quality, shape, and size. Depending on how you degrade an ecosystem, for example by converting a wetland into a network of highways, then you transform the ends and degrade the wetland irretrievably. So once you do that, then you ask yourself, have I not got an asset management problem to study? And of course, that’s exactly what it is.  You can call the biosphere natural capital.

What is biodiversity doing here? There, the problem with starting with biodiversity would have been that there is no unique way of thinking about biodiversity. We could be thinking in terms of the diversity of life. And you could look at it as species diversity. But, on the other hand, if you’re thinking of ecosystems as productive assets, which is what the review does, then what you are interested in is the productivity of the assets, and what makes for its productivity. So you ask yourself, what makes for a productive factory, which is going to be producing, let’s say, shoes? Then you will be listing all of the components that go into the manufacturing, in addition, of course, to the management structure. So that’s what we should be looking at. And the question then arises as to what kind of diversity we are looking at which makes an ecosystem productive. That might be different from species diversity. It could be a particular combination of species and communities of species, and in particular, a biotic environment in which the ecosystem must be. So that’s giving you the background to say that it’s really about asset management.

And the reason biodiversity in its various guises is important, is that there’s a great deal of empirical evidence that biodiversity contributes to ecosystem productivity. And when I say productivity, I mean all the goods and services that the biosphere produces, which we make use of. Some of which are observed, like agricultural fields producing wheat, rice, and so forth. Those are the tangible ones. But the ones which make biodiversity particularly interesting and complex are all these hidden services, on the basis of which we depend for our existence. I mean, nitrogen fixation, climate regulation, water purification, or decomposition of waste, these are all happening all the time. And these are services without which our economies would collapse.

Another point is that for a variety of reasons we face a serious asset management problem. If you just think in terms of markets, many of these assets don’t have markets for a variety of reasons. Mobility is one reason. These processes have effects which have long range transmission mechanisms, so that what happens here has consequences 5000 miles away; you can’t internalize that. We’ve got a massive public goods problem to handle which is why, of course, the management of these assets, like produced capital, and human capital, has gone wrong.

The third point comes from the second. The prices, or the costs that we face for using natural capital, are far lower, in many cases, to their accounting prices. The accounting prices are the true prices, their social benefits. We have had a development trajectory over the past 200 years in which produced capital and human capital have risen or accumulated at great length, and have given rise to tremendous prosperity for the economy. There is, of course, poverty, but I’m talking about averages. That’s a tremendous improvement, and we applaud it, we could say we’ve never had it so good. But we’ve done that at the expense of natural capital, which has shrunk. And our monitoring system doesn’t record that because GDP doesn’t record the depreciation on natural capital. So in a sense, we have been in a fool’s paradise, because on the one hand we’ve never had it so good but on the other hand, we are jeopardizing the future so badly that we’ve also never had it so bad, because we do care about the future,  for our children,  and grandchildren.

That is really the reason why your report has been so influential already, precisely because it gives you this unique view of looking at biodiversity or the biosphere as an asset; that we are not pricing it right; that we need to do something about this. I would like to ask about the following: we have this target for climate change where we would like to limit warming to 1.5 degrees Celsius. And I’m wondering whether there’s something like that for biodiversity. In  the 1950s, around 65% of the world was wilderness. In 2021, we’re now at 35%. If these trends continue, then we’ll have a mere 25% of wilderness left in 2040. In a sense, then, shall we not ask the question as to what is the optimal level of biodiversity? Or what is the optimal level of the biosphere?

This question is going to be impossible to answer very succinctly. For climate change there’s a single metric, carbon concentration, which has helped the economics of climate change enormously, because there is this thought that because of nonlinearities of the system, 1.5°C may be approximately the level where you do not wish to go beyond because it creates very serious difficulties. There’s nothing like that in the economics of the biosphere. As you can see immediately, the biosphere produces a huge number of services, not just climate regulation.

What has been done so far is to bring in a climate model which then has been grafted on to a mainstream model of growth and development, which has nothing to do with the biosphere. It has physical capital, or manufactured capital and human capital at best; and then something called technological progress. Then there is a by-product of output, which is carbon emissions. And those emissions accumulate in the atmosphere, and one would then write down an accumulation equation for carbon concentrations. Then you have a damage function, giving us how much how loss in welfare will arise, either indirectly through output reduction or directly on the utility function. And then you do a Ramsey exercise and if you do, you will get something like a shadow price. So, the atmosphere as a sink for your pollution ambition, which is the inverse of social cost of carbon. That’s pretty straightforward.

The corresponding thing for the biosphere to the 1.5°C target is the following. If you look at the findings in the Earth Sciences, in the Ecological Sciences, and some few publications from the Economics Sciences, then they tell us that over the past 50-60 years the demand we make on the biosphere, in terms of what we take from its services, goods and services, exceeds the regenerative natural return rate of the biosphere. So you can think of the biosphere as a renewable resource, as an asset, which is what it is, and you’re basically diminishing its stock. The stock itself is very heterogeneous with multiple services. Imagine, just for the sake of argument, that you had an accounting price for each of them, then you can aggregate and think of it as an aggregate stock and an aggregate flow of output, which you are using up in your production. We humans are degrading the stock, and the review calls the gap between aggregate demand for its services and the supply thereof the impact inequality. And that’s the corresponding thing to your 1.5°C.

You can’t have that gap persist, because if you do then the stock declines further and further and, of course, will lead to a catastrophe. If sustainable development means anything, it must as a minimum mean that we have to close the gap between demand and supply.

I totally agree with you and I this is the reason why conservation is one of the key issues. But let’s also think about this in terms of restoration. Conservation would be to deal with this impact inequality, shouldn’t restoration also tell us something about the optimal level of the biosphere?

Conservation says lay off, lay off this wetland or this coastal fishery because it’s damaged, let it recover on its own. That’s costly, because you’re not going to be doing things with it, which you were planning to do before, like taking more material out of it. Restoration means that we do something in addition to helping it regenerate. Restoration is the more active version of conservation. Both of them have their cost in terms of forgone whatever else that we would otherwise do. Closing the gap is now an imperative. Just as in climate science, you might say that keeping to a maximum warming of 1.5°C is an imperative.

What the review does is to decompose the aggregate demand in the way that Ehrlich and Holdren did in 1971, which I thought was very useful. We decompose it into total population, per capita GDP, and the efficiency with which our institutions and our existing technologies transform nature’s goods and services into the final product. (That’s one kind of decomposition, you can think of many other ways of doing the decomposition.) This decomposition tells us that there are these three objects that policies could be directed at in order to bring down the demand. One is future population and standard of living, if you like waste and so forth, another is the technologies and institutions.

But then you have the production function, if you like the output of nature, the supply, the regenerative rate. Just for the sake of argument, imagine that we have accounting prices, so we have aggregates, and we’re looking at scalar measures. If you can’t do that, then you have a vector of inequalities, and the impact inequality that I mentioned is not a scale of one inequality anymore, but instead a whole range of inequalities, one for each of the services (one of them would be climate, emission versus absorption of carbon in the atmosphere, etc.). Let’s stick, nevertheless, to the aggregate form for a convenience of conversation, which gives us one inequality. On the one hand there is, of course, the productivity of the biosphere. And that’s where your conservation and restoration comes in, in order to close the gap. And you could do that either by improving the stock, which is what you’re thinking of, or you could be thinking of trying to help make whatever stock you have more productive. So, for example, genetically modified crops is a way to enhance the productivity, whereas if you increase the stock you’re increasing the size of the wilderness.

Instead, we might say, we have the gap, and now, let’s do an optimization exercise. And seeing how to face the gap, we know that the optimization exercise will say you’ll have to close the gap at some time, because otherwise, you won’t be optimizing. But the date of closure will be an endogenous variable in an optimization, which is what you’re asking, and you’re absolutely right. We could proceed in that way. I didn’t do it in the review that way, although there are hints at it. In fact, if you look at the star chapters, chapter four of the main review, and chapter 13*, you will see that I go exactly the way you direct. But I stopped, shortened it, kept it in a star chapter so it’s really for the graduate students to take it further. And the reason is that we are far from being able to do anything. We don’t have the data, we don’t really know the production function. We don’t know how many species there are. When I say we, I mean even those who know don’t know, referring to the best ecologists who work on this field. People like Peter Raven, Stuart Pim, Paul Ehrlich, have written and continue to write papers on this.

They estimated a range from 8 million to over 20 million, possibly more than 20 million species, of only organisms which have a nucleus in their cell. In addition, there are then countless more bacteria and others who don’t have a nucleus. When you’ve got that kind of uncertainty, when you have such little knowledge of what goes on inside the forest, at this point, we don’t have anything like a notion of a production function.

But I think one reason I can keep on harping on closing the gap is for a similar reason to the one the climate scientists, not economists for climate change, but climate scientists have said: “Keep away from 1.5°C, because the model suggests that beyond 1.5°C it’s so nonlinear, there are zones of danger”. That’s coming from the science, not from the economists, and what we can do is to use the science to inform our economics. And because of that maybe it makes sense to have quantity targets, like 1.5°C. And hence, correspondingly, I’m saying that we should concentrate on closing the gap. We are in such a second best world that that may be the right thing to do. Because we have many things we can do even without optimizing, like improving our institutions, for instance. And that’s why so much of the review is really about institutional reform.

Given that we know so little about the biodiversity and the biosphere and how it feeds back into our economy, and given that there’s such a significant degree of uncertainty, isn’t it then best to follow a most rapid approach path in order to close the gap?

I didn’t quite use the word but you’re quite right. That’s a very, very good point you’ve just now made that in effect. I’ve been saying that because I say closing the gap is the most urgent thing to do. Think of it as being in a firefighting situation. I don’t know any evidence, which does not say that demand has been exceeding supply for about 30, 40, 50 years. Just bear in mind that many scientists have suggested that we should regard approximately 1950, the period following the Second World War, as the point at which we entered the Anthropocene and moved away from the Holocene. By that they mean that if you draw these time series of some of the biggest markers that describe the state of the earth system, such as nitrogen, phosphorus, the deposits and so forth, you see that these markers were pretty much non-increasing up to the beginning of the Industrial Revolution, and then they rise slowly. Then about 1950 onwards, they rise at a fantastically fast rate. And this is mimicked in carbon concentration time series, as you know, that famous hockey stick in the  climate science. And it’s replicated in global GDP and global population, in global GDP per capita.

And so, yes, I think there is a very strong case for thinking in terms of putting on the brakes, and it is a firefighting situation, because the gap is huge. Now, some estimates suggest that the footprint is something like 1.5, 1.6, 1.7 or so, the exact number is not so important as these are extremely crude estimates. One reason they are very crude is that very few people do this kind of work. Economists certainly haven’t been doing it, apart from a few. And these have been in the United Nations Environment Program or the United Nations University. I’ve been involved with that work, but it’s not really been done by academic people. It’s been done by departments within the UN organization. So in a sense, we should be a bit embarrassed about that: we as a profession, because we should have been doing this. This is rich capital theory work and the bedrock of growth and development economics and we have been ignoring it. So it’s like a firefighting situation. Now if you’re faced with a really large scale fire, then what is it that a firefighter does? He doesn’t optimize. He  first wants to know the terrain. So that he gets a broad picture of what needs his attention, which is where you should head first, and then you do the detailed work. Likewise, the time minimization problem or strategy approach insight is an intuition that you put all your energy onto this problem now. It’s an intuition and I think it’s corrected, because of all these uncertainties.

This brings us immediately to the accounting prices. In your review you were saying that these accounting prices are basically not reflected in the market process. And that’s a huge problem. So the accounting prices should reflect nature’s worth to society, or our common good. Now given that we know so little about the biosphere; given that we face such a high uncertainty; and given that we should follow up the most rapid approach path to close the gap, does this not more or less immediately imply that the accounting prices right now should be extremely high, if not close to infinity?

Actually, that’s absolutely correct, they are high. We don’t have to worry about infinity, high enough would do the trick for you, and you know that’s not a problem. But you’re absolutely right, you put your finger exactly on the right button here. Because the review spends a great deal of time thinking of alternative institutions, and on different types of institutional reforms that we need. Starting from the very local level of a village economy in Sub Saharan Africa or South Asia up to the global level, we have covered a lot in the review. The reason is because the heterogeneity of the biosphere ecosystems differ spatially and their productivities are different, so you cannot take good terms of one set of institutions. There’s a huge literature particularly in anthropology, and some in geography, and, of course, economists have gone into it but not the economists we know in the West. They don’t do that, it’s really up in South Asia and Africa, and Latin America. I know their work extremely well, and I think I’m very proud of the fact that so many of the references in the review, which I use in the bulk of the chapters come from publications from unknown universities in Asia, Africa, and Latin America. Those papers study  local ecosystems. The way they’ve been managed, and the community management structures differ enormously: coastal fishery differs from a wetland management, from a mangrove, and so on. We have good reasons to understand these social norms of behaviour, which guide these resources, because we economists know how to think about them in an ordered way, and I try and do that in the review.

And then, one of the real realizations is: maybe the state ought to be far less involved in the management of resources. They have actually contributed to the erosion of especially local natural capital. There’s tons of evidence of that, largely because they’ve interfered with social norms and have not been able to replace these with adequate governance structures that substitute for the broken down social norms, largely because they don’t have a clue. The governments know nothing about what’s happening in local fisheries, for example. It is the coastal fishermen who know and they have actually constructed norms of behaviour; when to catch, where to catch, how to share the catch and so forth.

While there is that at the local level, at the global level you have this huge number of open access resources. Now you don’t need too much of any optimization to say that one ought to bring in institutions for that, and one of the ideas that I had in the review was the creation of an international agency like the World Bank and the IMF, who are given the task to monitor and manage, and perhaps, ideally, charge for the use of the global commons. The rent that they would be charging would be the accounting prices for the use of the open access resources which would also be a terrific revenue generating source. In addition, of course, it would also simultaneously lift the pressure from ecosystems such as the ocean or the atmosphere, as a simple solution. But we haven’t gone down that route. I haven’t seen any serious proposal in COP15 which even thinks in terms of the management of the global economy. So, the review has gone from (instead of) trying to estimate accounting prices, which would be an impossible thing just at the moment, to thinking of alternative institutional arrangements. One could start thinking about imposing such rents, they won’t necessarily be the optimal, but anything positive is better than zero. Or at least, when I say anything positive I don’t mean infinitely higher. And there’s a lot there that one can do.

One further point I’d like to make is that one of the things that the review emphasizes and something that I think all economists should agree to, is that these accounting prices have so much of a normative feature built into them, sort of like market prices. If you accept market prices, you’re already buying into the normative structure, but accounting prices are more overt, so people aren’t going to agree necessarily on accounting prices. Think of the controversies over the social cost of carbon, for example: you have a range from $10 a tonne to $200. Why? because the estimates differ. That shouldn’t stop us from thinking in terms of accounting prices because it shouldn’t stop us from debating political activities or public policies. If we have differences of opinion we should resolve this in a democracy through our votes. So, I’m not worried about that, I still use the word common good. I think you’re exactly right, to think of the common good at this point rather than talk about social welfare, and that’s because so much of the imperfection of the contemporary world is such that there are movements in which everybody can benefit that we can talk about the common good. So let’s stick to that here.

If we have time I would like to get back to the institutions, because I think your proposition that you made there is absolutely vital. I’d like to very quickly come back to the accounting prices and there’s a question by Professor Jasper Mayer from the University of Leipzig, and he basically asks what needs to be scientifically done to systematically measure and implement accounting prices for biodiversity.

Well, there’s a good deal of work already there. For instance, there’s a whole book or volume of essays that was produced by SANDEE, the South Asian Network for Development and Environmental Economics, being a Cambridge University Press publication which came out in 2014 or 2015. What people tend to do is to study ecosystems, and look at the productivity of ecosystems, and see what it is bringing to the neighbouring economy. Now, there are many ways of thinking about it, in some cases, at least in the United States, a lot of it was done through viewing ecosystems as amenities to the willingness to pay. So they have been asking how much you’re willing to pay to clean up say the Pacific, or the Chesapeake Bay. That’s one kind of way of trying to estimate, but that doesn’t require knowledge of the productivity, it’s how you think of bird populations or whatever.

The reason the work that I cited just now is important is that it looks at the productivity of ecosystems. Let’s take the example of shrimps cultivation, which destroys mangroves. So the idea is that when you evaluate a new investment in a shrimp farm, then one of the cost items which is very often missed is the value of the mangroves which is being destroyed by that. The question then trips up as to what the mangrove forests do for the local community. One of the benefits would be the protection against floods and storms. You can have estimates of the protection offers, and you thereby try to estimate the accounting price. It’s very much like a production function structure and you look at the productivity of the capital asset, and then see what it looks like.

These accounting prices tend to be local accounting prices. They treat biodiversity, or the biosphere, as a local public good. But, in fact, what one would like to argue is that they should be viewed in an international way, globally, and thus we need to deal with spillovers, and that is something that is not currently reflected in the accounting prices.

Absolutely, the analogy would be over climate, because there are global estimates, and they tend to be looking at the global side of things. You can do something like that for the biosphere but it’s early days precisely because the production functions have not really been estimated. It is not that it can’t be done. It’s that we’re really at the earliest stages of doing it. I was previously talking about an international organization, which could in principle monitor and charge for traffic across the Pacific and the Atlantic because that damages the ecosystems, such as the oceans. The oceans are in a bad way for a variety of reasons, it’s not just one. It’s because of all the pollution we are dumping in them through the river systems if nothing else, and all the plastic that goes and transfers itself. Now it is possible, in principle, I don’t see any intrinsic difficulty, to take into account all the externalities and to look at the services that the oceans provide. For example, climate regulation is extremely important. Then, of course, transportation is another, which brings in pollution as well as disturbing aquatic life.

In the end, you will be looking at the oceans as capital asset with the productivity producing multiple products, some of which compete against one another. That’s the key thing. We should not be surprised by that, but I haven’t seen any convincing model yet. That doesn’t mean it can’t be done, I think that five years of work by a group of really bright economists should be able to bring sensible answers to these questions.

So you would say that an important step in order to systematically measure the accounting prices would be to really figure out their production functions.

Absolutely for the reason that that’s what they’re supposed to be doing. It’s accounting prices, if you like the common slope of indifference curves and isoquants. So yes, you do need to know the productivity, because that’s where the action is. And then what you do is you see the rate of return on investment. In this case, reducing the harm that you inflict on the oceans is very high, then you do that.

Let me give you a cleaner answer. In chapter 2 of the review you will find the box in which I do what I think is really one of the best calculations I’ve done in recent years. In the ecological text, I found data on the total stock of primary producers. Primary producers are organisms that photosynthesize. So they’re the bedrock of all life, which everything else depends on. These are the plants, algae, and many bacteria, and we have estimates of the global stock of primary producers, published about two years ago in the Proceedings of the National Academy of Science. There are also estimates using similar techniques for the global production of biomass. Now biomass is being produced by primary producers. When I saw those two estimates I divided the one by the other. And that gives me the average return because it’s the total output divided by the total stock. Do you know what the figure was? The numbers I have in front of me from the publication was 19%, a year. Let’s start with a year. Now you compare that with the yield or own rate of return on physical capital, which is globally  about 5%. So you’ve got a huge difference. Now that doesn’t mean anything on its own, because you could say if it’s an optimal asset management, then there will be a rate of return on this. There’ll be capital gains on physical capital of the order of 14% to make up for the gap between the 19% and the 5%. Okay, if that happens then we are indifferent between holding natural capital, and physical capital, but of course that can’t be right because we know natural capital is declining relative to physical capital, which is the impact inequality that I began with. If that’s the case, then capital gains ought to be just the reverse. Natural capital’s price ought to be increasing relative to physical capital. So we’ve got a clean way of showing that we’re in a massive allocation failure. We’ve got a huge rate of return in primary producers. Now remember that 19% isn’t the minimum because it’s the average, you’re not looking at the bottom. That’s the kind of thing that can be done, even as we speak. So we now know that the shadow price would be much higher if we moved in that direction.

Let’s talk a bit more about the institution, and I would like to link this to trade. In the review you often point out that the developed countries live off the resources of developing ones. It’s clear that the reason for this is not only due to comparative advantage, but it’s mainly because the developed countries already are above their own biocapacity. Their biocapacity does not provide enough for all their consumption. Thus, could we say that trade in natural resources is a key sign of overconsumption?

The way we have taught the citizens to think of trade, and then look at the growing prosperity throughout the world, the reduction in extreme poverty and so forth and so on, we generally tend to put it on trade. And a lot of it is on trade. Globalization has been the big song and dance over the past 40 years and it certainly has helped enormously in precisely those indicators such as GDP. We’ve never had it so good.

But now let’s look at the `we’ve never had it so bad side of it’. I think we teach trade very badly. I think textbooks are really misleading and I think the World Trade Organization has been really very, I would say, “naughty”, in not recognizing that the missing markets really affect our conception of trade. The theory of comparative advantage and the gains from trade the whole architecture is built on the idea of complete markets. We wouldn’t be discussing the economics of biodiversity if we had  complete markets. The tendency of trade has been through the industrial revolution to import primary products from what used to be poor countries. That’s fine, there’s nothing intrinsically wrong with it and the review is not claiming that. Nor am I going through any exercise in political exploitation. I was simply asking as to what happens to resource allocation if there is a massive failure of pricing on the primary product. If they are underpriced, then there is a resource transfer from the poor countries to the importing countries. A straightforward example is deforestation, where you cut down trees to supply timber and then there are local externalities associated with the reduction of tree coverage. These externalities are usually not priced, and so therefore exporting countries are actually losing resources when they export to the importing ones. I haven’t done major calculations, showing how much transfer has been taking place because again you have to estimate those externalities, some of which have been done in the case of South Asia. In shrimp farming, that’s very interesting because, again, there are these externalities which have actually been estimated. So if we look at that, you can work out how much of the underpricing is taking place. So there are ways of doing it if we are patient and systematically work through factor missing markets in primary products. We can get a long way towards trying to understand the character of international trade. This is not an argument against trade, by the way. It’s just an argument saying that we need to recognize that free trade has its consequences, which we often  forget.

Let’s finish with a personal note from your side. Are you optimistic or pessimistic about the future of biodiversity and our biosphere?

I can’t really answer that. I’m not built that way. I think I’ve been built from a parental background to be somebody dispassionate and studying. Some days I feel like things are moving in the right direction. And then something happens… I don’t know whether I’m optimistic or pessimistic. I don’t think humanity is going down the tube in 10 years, 15 years, 100 years even. We’ll muddle along, and then, as usual, what will happen is the rich, those who are already ahead will continue, relative to the poor, which is what the iron law of economics dictates.

I think that we are likely to see more ecological crises, and they’re growing in numbers in some sense. It may be biased reporting as there’s greater coverage today than it used to be before. But there’s no question that I take the impact inequality extremely seriously. And if I stare at it, I should be pessimistic because I don’t see the firefighting mode in international relations at all. If Cop15, Cop26move us in that direction,(and I don’t know if they do), then I’ll be somewhat optimistic.

Would you have any last thoughts for policymakers or environmental economists?

There are policymakers and there are policymakers. The UK Government takes natural capital very seriously. The UK government’s response to the review was published and it’s on their website now. It was a very favourable and  concerned one, and they pointed to the things that they’re intending to do and the things that they are already doing. On the other hand, you have nations where the development needs are defined as increasing physical capital and human capital in order to make living conditions seemingly better. I know that because I was involved in discussions over the years with at least one of these countries. I would say that if I were advising a really a poor country, a primary product producing country, I would say: Lay off, and help local communities. Respond to their demands for how you can help them. Do not pretend you know the local ecosystems as well as they do. A lot of the distress migration can be traced to ecosystem collapses there.

I wonder why in rich countries like the G7, we aren’t discussing the ways of handling the global commons. Again, I’d come back then to introducing international institutions, rather than having bilateral agreements, as they don’t mean much. So, for example, Norway says that it’s paid for the protection of the Amazonas , and they have been disappointed with the outcome. Well, there’s no way of ensuring compliance. First year economics tells us that we have an open access resource problem, so we need a global institution to manage it. Since you say everybody owns it, it means nobody owns it, therefore it’s open access. The tragedy of the commons is that that metaphor continues.

Personal comment: At this point I would also like to thank those who sent me potential questions for this interview. Unfortunately, one hour proved far too short in order to go through these. I would like to thank Jasper Meya, Daniel Spiro, Sergey V. Popov, Ibrahim Amadeus Ricky, Astrid Dannenberg, Nicholas Baigent, Olof Johansson Stenman, Esfandiar Maasoumi.