Abstract

Biodiversity destruction is an urgent problem on the world-wide environmental policy agenda. To get an idea of the losses for present and future generations and to deduce policy measures, valuations in monetary terms have been discussed and applied to biodiversity. However, the example of biodiversity emphasizes that the application of these measurements is more limited than widely believed. For an ecologically tenable, economically meaningful and ethically justifiable valuation of biodiversity restrictions of the area of application and a careful interpretation of the results are indispensable. The subject is outlined by exhibiting the different ecological dimensions and aspects of biodiversity and showing its manifold significance to humans. On this basis five aspects are discussed concerning basic steps of valuations, fundamental assumptions and limitations. Firstly, valuations entail a comparison between nature and market goods. This implies cutting off the natural good from its functional relations and making it substitutable. Secondly, using individual utility as an indicator of value involves the problem of incongruity and it fails to capture social preferences. Further, the individual perception of the value of biodiversity and the information about it are widely limited. This reduces the meaningfulness of valuations based on individual preferences. Fourthly, the existing institutional context, like social distribution, prices, trade relationships or governmental policies broadly influence valuations. Finally, monetary valuations cannot capture the medium or longterm values of biodiversity nor the aspirations of future generations, as market values are mainly referring to the present. All these points call for a limited application of valuations of biodiversity and careful interpretations.

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