1. Ch 2 Environmental Ethics and Economics: Values and Choices
Part 1: Foundations of Environmental Science
PowerPoint® Slides prepared by
Jay Withgott and Heidi Marcum
Copyright © 2008 Pearson Education, Inc., publishing as Benjamin Cummings

2. This lecture will help you understand:
Culture and worldviews
Environmental ethics
Classical and neoclassical economics
Economic growth, economic health, and sustainability
Environmental and ecological economics

3. Expanding ethical concern
Why have we expanded our ethical concerns?
Economic prosperity: more leisure time, less anxieties
Science: interconnection of all organisms
Non-western cultures often have broader ethical domains
Three perspectives in Western ethics
Anthropocentrism = only humans have rights
Biocentrism = certain living things also have value
Ecocentrism = whole ecological systems have value
Holistic perspective, stresses preserving connections

4. Western ethical expansion

5. History of environmental ethics
People have questioned our relationship with the environment for centuries
Christianity’s attitude towards the environment
Anthropocentric hostility, or
Stewardship?
The Industrial Revolution increased consumption and pollution
People no longer appreciated nature
Transcendentalism = nature is a manifestation of the divine
Ralph Waldo Emerson, Henry David Thoreau

6. The preservation ethic
Unspoiled nature should be protected for its own inherent value
John Muir (right, with President Roosevelt at Yosemite National Park) had an ecocentric viewpoint

7. The conservation ethic
Use natural resources wisely for the greatest good for the most people
Gifford Pinchot had an anthropocentric viewpoint

8. The land ethic
Healthy ecological systems depend on protecting all parts
Aldo Leopold believed the land ethic changes the role of people from conquerors of the land to citizens of it

9. Environmental systems support economies
Ecosystem services = essential services support the life that makes economic activities possible
*Soil formation *Pollination
*Water purification *Nutrient cycling
*Climate regulation *Waste treatment
Economic activities affect the environment
Deplete natural resources
Produce too much pollution

10. Classical economics
Competition between people free to pursue their own economic self-interest will benefit society as a whole (Adam Smith, )
The market is guided by an “invisible hand”
This idea is a pillar of free-market thought today
It is also blamed for economic inequality
Rich vs. poor
Critics think that market capitalism should be restricted by government

11. Neoclassical economics
Examines the psychological factors underlying consumer choices
Market prices are explained in terms of consumer preferences
Buyers vs. sellers
The “right” quantities of a product are produced
The market favors equilibrium between supply and demand

12. Marginal benefit and cost curves
Cost-benefit analysis = the costs of a proposed action are compared to the benefits that result from the action
If benefits > costs: pursue the action
Not all costs and benefits can be identified
Marginal benefit and cost curves determine an “optimal” level of resource use or pollution mitigation

13. Neoclassical economics
Enormous wealth and jobs are generated
Environmental problems are also created
Assumptions of neoclassical economics:
Resources are infinite or substitutable
Costs and benefits are internal
Long-term effects are discounted
Growth is good

14. Is economic growth sustainable?
Affluenza = material goods do not always bring contentment
Uncontrolled economic growth is unsustainable
Technology can push back limits, but not forever
More efficient resource extraction and food production perpetuates the illusion that resources are unlimited
Many economists believe technology can solve everything

15. Other types of economists
Ecological economists = civilizations cannot overcome environmental limitations
Steady state economies should mirror natural ecological systems
Calls for revolution
Environmental economists = unsustainable economies have high population growth and inefficient resource use
Modify neoclassical economics to increase efficiency
Calls for reform

16. A steady state economy
As resources became harder to find, economic growth slows and stabilizes (John Stuart Mill, )
We must rethink our assumptions and change our way of economic transactions
This does not mean a lower quality of life
Economies are measured in various ways
Gross Domestic Product (GDP) = total monetary value of final goods and services produced
Does not account for nonmarket values
Pollution increases GDP

17. GPI: An alternative to the GDP
Genuine Progress Indicator (GPI) = differentiates between desirable and undesirable economic activity
Positive contributions (i.e. volunteer work) not paid for with money are added to economic activity
Negative impacts (crime, pollution) are subtracted
In the U.S., GDP has risen greatly, but not GPI

18. Markets can fail
Market failure = markets do not account for the environment’s positive impacts
Markets do not reflect the negative effects of activities on the environment or people (external costs)
Government intervention counters market failure
Laws and regulations
Green taxes = penalize harmful activities
Economic incentives to promote conservation and sustainability

19. Ecolabeling addresses market failures
The market can be used to counter market failure
Create markets in permits
Ecolabeling = tells consumers which brands use sustainable processes
A powerful incentive for businesses to switch to better processes
“Dolphin safe” tuna
Socially responsible investing in sustainable companies

20. Conclusion
Recent developments have brought economic approaches to bear on environmental protection and conservation
Environmental ethics has expanded people’s ethical considerations
Economic welfare can be enhanced without growth, resulting in economic health and environmental quality

21. QUESTION: Review
An ecocentric worldview would consider the impact of an action on… ?
a) Humans only
b) Animals only
c) Plants only
d) All living things
e) All nonliving things
Answer: d

22. QUESTION: Review
Which ethic holds that healthy ecosystems depend on the protection of all their parts?
a) Preservation ethic
b) Land ethic
c) Conservation ethic
d) Deep ecology
e) Biocentrism
Answer: b

23. QUESTION: Review
Which of the following is an ecosystem service? a) Water purification in wetlands
b) Climate regulation in the atmosphere
c) Nutrient cycling in ecosystems
d) Waste treatment by bacteria
e) All of the above
Answer: e

24. QUESTION: Review
Which is NOT an assumption of neoclassical economics that can lead to environmental degradation?
a) Resources are limited
b) Long-term effects are downplayed
c) All costs and benefits are experienced by the buyer and seller alone
d) Growth is good
Answer: a

25. QUESTION: Review
Which of the following statements would be spoken by an ecological economist?
a) The current economic system is working fine
b) The current economic system simply needs to be fine-tuned
c) The current economic system is broken and a new one needs to be developed
d) Economic systems never work
Answer: c

26. QUESTION: Interpreting Graphs and Data
Market equilibrium, which sets the price of a product, is reached …
a) When supply exceeds demand
b) When demand exceeds supply
c) By demand when quantity is low, and supply when quantity is high
d) When supply equals demand
Answer: d

27. QUESTION: Interpreting Graphs and Data
Which conclusion can you draw from this graph?
a) GDP has not really increased since 1950
b) Although we are spending more money, our lives are not much better
c) We are spending less money, and our lives are much better
d) The GPI is not as accurate as GDP
Answer: b

28. QUESTION: Viewpoints
Think of an issue in your community that could pit environmentalists against economic development. What do you think should prevail: environmental protection or economic development?
a) Economic growth; we need the jobs
b) Environmental protection; we need the environment
Both; a compromise must be reached
Whatever costs the taxpayers the least
Answer: any

29. QUESTION: Viewpoints
What entities do you include in your domain of ethical concern?
a) Humans only
b) Humans and pets
Humans, pets, and other animals
Humans, pets, other animals, and nature
Answer: any