The economics of biodiversity: the evolving agenda

This paper assesses how the economics of biodiversity, as a field, has evolved in response to developments in biodiversity science and policy over the life of the journal, Environment and Development Economics. Several main trends in the economics of biodiversity are identified. First, biodiversity change has come to be analyzed largely through its impact on ecosystem services (in the sense of the Millennium Ecosystem Assessment). Second, there has been a growing focus on factors that optimally lead to biodiversity decline, i.e., the benefits to be had from reducing the abundance of pests, predators, pathogens, and competitors. Third, increasing attention is being paid to two global drivers of biodiversity change, climate and global economic integration, and the effect they have on the distribution and abundance of both beneficial and harmful species. Fourth, there has been growing interest in the development of instruments to deal with the transboundary public good aspect of biodiversity, and in particular in the development of payments for ecosystem services. The paper identifies the influence of these trends on attempts to model the role of biodiversity in the production of goods and services.