Economics and the Price of Nature

Assume a glacier that provides summer water for a billion people. What is its value, if it is destroyed by global warming? Since it currently provides services for free, it could be calculated as zero, according to some. Hence, a hypothetical economic activity by those people that gave them one dollar in total while destroying the glacier completely, would be worth doing? That’s suicide economics.

The word VALUE, it is to be observed, has two different meanings, and sometimes expresses the utility of some particular object, and sometimes the power of purchasing other goods which the possession of that object conveys. The one may be called “value in use”; the other, “value in exchange.” The things which have the greatest value in use have frequently little or no value in exchange; and on the contrary, those which have the greatest value in exchange have frequently little or no value in use. Nothing is more useful than water: but it will purchase scarce any thing; scarce any thing can be had in exchange for it. A diamond, on the contrary, has scarce any value in use; but a very great quantity of other goods may frequently be had in exchange for it.

Who’s the radical greenie who wrote the above? Mark Sagoff wrote an essay on stupid valuation of nature’s services back somewhen, where he made the above quote. Find out there, who said it…

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