Natural capital and sustainable development: The story so far

Abstract: Natural capital is a way of conceptualizing the linkages between economics and the environment. The concepts foundations can be traced back to the environmental movement of the 1970s and the works of influential economists at that time. Natural capital has come to have an elevated position in environmental conservation approaches in the United Kingdom. The UK government's advisory body, the Natural Capital Committee, is the first of its kind in the world to be established. The concept of natural capital points to those aspects of the environment that directly or indirectly are of value to people. Such aspects include the functions and services of ecosystems, species, and habitats, as well as atmospheric protection and clean air and rivers. Natural capital is also a central concept in the capital approach to sustainable development and the ecological economics field. However, natural capital has not been accepted into environmental conservation approaches in the UK without criticism. Considering natural capital's history then, and its current popularity in environmental conservation, this thesis is interested in addressing the key question: what is natural capital? To be able to account for natural capital's origins, definitions, development, and issues and debates about it, the method used for this thesis is wholly comprised of a literature-review. Throughout the review, reference is made to key scholarly works where natural capital is defined, developed, and used as a central concept. With regard to literature about natural capital, much of it is comes from scholars strongly associated with ecological economics. In addition, natural capital is analysed from three different perspectives. The first perspective is conceptual-historical, the second is a sustainable-development perspective, and the third a political-ecology perspective. From a conceptual-historical perspective, natural capital can be understood as a concept which has developed out of a body of thought of environmentally-aware economists who argue that economics must better take account of ecological systems and their complexity. From a sustainable development perspective, natural capital is a central concept underpinning a capital-based approach to sustainable development. Natural capital also features centrally in debates about how to give an operational meaning to 'sustainability' based around the traditional economic concept of capital. The key debate in this regard concerns weak versus strong sustainability. From a political-ecology perspective, the natural capital approach to environmental conservation is, in ideological terms, of a neo-liberal nature. Natural capital and economic valuation in environmental conservation arguably facilitate the 'monetization' and 'economization' of the environment. Natural capital is opposed for ideological and ethical reasons. Another view would present natural capital as a key part of the economists pragmatic attempts to improve the way economies are managed through better linking economics and the environment. By conveying the economic value of the environment we may be able to put it in a better standing in the priority policy-lists and economic-development agendas of governments and international development agencies. In the United Kingdom there continues to be an ongoing debate about natural capital's place in environmental conservation. This thesis is intended to be a contribution to that debate.