




































Ecology, Economy and Society–the INSEE Journal 4 (2): 13-19, July 2021 

COMMENTARY 

Conserving Economics for Biodiversity: Reflections 
on “The Dasgupta Review” 

Rajeswari S Raina1 

Abstract: The Economics of Biodiversity: The Dasgupta Review (Dasgupta 2021), 

henceforth the Review, tells us that we are embedded in Nature and our economies 

are bounded within Nature. It helps us estimate the value of natural capital and 

include it in estimations of economic output. The Review’s key messages concern 

(i) keeping our demands well within Nature’s supply, (ii) moving away from gross 

domestic product (GDP) towards inclusive wealth as a measure of economic 

success, and (iii) acknowledging the institutional failure in addressing global 

environmental problems and resolving them through institutional reforms in the 

financial and education systems. However, this commentary suggests that the 

Review is about conserving economics for biodiversity. It offers little opportunity 

for transformative change in our thinking and acting, to change our relationship 

with Nature so that we can conserve its diversity and dynamism. This commentary 

suggests possible ways forward, drawing upon lessons on non-linear behaviour, 

emergent properties, and complexity in Nature. These include looking to niche 

communities that live within the limits set by Nature, learning from various 

environmental social sciences on how to maintain and promote the aggregate 

stocks and funds of Nature; and finding ways to include economic activity and 

output in value frameworks of sustainability, justice, and diversity. 

Keywords: Biodiversity; Conserving Economics; Institutions; Complexity; 

Environmental Social Science. 

                                                        
1  Professor, Department of International Relations and Governance Studies, School of 
Humanities and Social Sciences, Shiv Nadar University, NH91, Tehsil Dadri, Greater Noida, 
Uttar Pradesh – 201314; rajeswari.raina@snu.edu.in.  

Copyright © Raina 2021. Released under Creative Commons Attribution-NonCommercial 

4.0 International licence (CC BY-NC 4.0) by the author.  

Published by Indian Society for Ecological Economics (INSEE), c/o Institute of Economic 

Growth, University Enclave, North Campus, Delhi 110007.  

ISSN: 2581-6152 (print); 2581-6101 (web). 

DOI: https://doi.org/10.37773/ees.v4i2.464  

mailto:rajeswari.raina@snu.edu.in
https://doi.org/10.37773/ees.v4i2.464


Ecology, Economy and Society–the INSEE Journal [14] 

1. THE REVIEW 

The Review is rich with powerful and critical findings. But it seems to 
conserve economics; it offers little opportunity to transform our economies 
and societies by changing our relationship with Nature.  

The Review tells us repeatedly that we are part of Nature and are embedded 
in it. Nature, or the biosphere, has limits; but our lifestyles and production 
and consumption behaviours treat Nature as a perpetual and inexhaustible 
supplier of goods and services. As one news article proclaimed, quoting 
Professor Dasgupta, “Nature is a blind spot in economics that we ignore at 
our peril” (HM Treasury 2021). Indefinite growth of global economic 
output is not possible. Gross domestic product (GDP), which is 
understood as the market value of the flow of final goods and services in a 
country in a given year, is an inadequate measure of wealth and wellbeing. It 
encourages governments to pursue unsustainable economic growth at an 
immense and irreversible cost to Nature. 

In the first part, Chapters 1–13, Prof. Dasgupta makes it clear that our 
economic activity has crossed known planetary limits (see subsection 4.1.2., 
p. 127 and p. 338). The second and third parts of the Review take us 
through extensions (including chapters on the conservation and restoration 
of Nature) and the road ahead (options for action), maintaining that “the 
fault is not in economics” but in the way we have chosen to practise it (p. 
498). The prevalent macroeconomics of economic growth and development 
does not recognize humanity’s dependence on Nature (p. 38). 

Our commitment to economic growth and using GDP as a measure of it 
are evident in both the Intergovernmental Panel on Climate Change and the 
Sustainable Development Goals (see Box 4.5). Governments and their 
statisticians and planners are obsessed with efficiency parameters. Further, 
our current predicament, the sixth mass extinction of species, is not just due 
to market failure. It is due to persistent and pervasive institutional failure in 
addressing global environmental problems like climate change, loss of 
biodiversity, and unsustainable development. These institutional failures can 
be resolved when the “social evaluator” or “citizen investor” (who replaces 
the utility-maximizing individual consumer or investor) evaluates options 
on behalf of society using the criterion of “inclusive wealth” (Chapter 13). 
Inclusive wealth and inter-generational well-being are not the same entity 
but move in step with each other (see p. 327). This inclusive wealth/well-
being equivalence theorem leads us to the sustainable development 
theorem, which states that intergenerational well-being increases over a 
period if and only if inclusive wealth increases over the same period. Armed 
with this knowledge, the citizen investor can make positive investments and 



[15] Rajeswari S Raina 

include stocks (not just flows of capital) in her estimation of returns on 
investment suitably discounted over time to arrive at national inclusive 
wealth. The empowered citizens can demand and enable public policy 
choices that respect social cost–benefit (social-NPV (net present value)) 
estimates. 

The Review tells us that transformative change in our mode of thinking and 
acting is necessary and possible. We need to (i) ensure that our demands on 
Nature do not exceed its supply and (ii) find ways to increase Nature’s 
supply compared to its current level. We have to discard GDP and measure 
“inclusive wealth”, which is the weighted sum of the stocks of all capital 
goods (produced capital, human capital, and natural capital) in the 
economy. It suggests that we change our institutions, especially those 
protecting public goods and governing financial and educational systems. 
Supra-national institutional arrangements and public and private financial 
investments in economic activities that stand to enhance our stock of 
natural assets and incentivize sustainable production and consumption 
activities are needed. Governments and international actors like multilateral 
development banks can enable these investments in Nature. Action is 
needed across scales by multiple actors—from the introduction of supra-
national governance of ecosystems located within national boundaries 
(biomes like tropical rainforests) and outside of them (the oceans) to 
inculcating discipline in individuals and educating them so that they can 
make informed choices and invest wisely. 

  

2. ECONOMICS IN THE REVIEW: SOME REFLECTIONS 

Let us begin with the model of “The Bounded Global Economy” that 
shapes the Review, which is presented in Chapter 4. This model does not 
show how the economy exists within Nature and how it behaves as 
embedded in it. The presentation of produced capital, human capital, and 
natural capital, and the flows between them (Fig 1.1), and the 
dematerialized anthropocentric innovations and reforms meant to balance 
humanity’s demands and Nature’s supply (Fig. 21.2), are not mere 
corrections in the practice of economics. These are the core of economics 
and the Review. In Part I, the Review fundamentally seeks to reinforce 
economics and its formalism to ensure that Nature is included in the global 
economy. This denies Nature its agency, its self-organizing and non-linear 
behaviour, emergent properties, and complexity. It does make it possible to 
include natural capital (the flow of provisioning services) (R), and the stock 
supplying regulating and maintenance services (S)) in the economy, as long 
as it stays within a safe limit (L). In economics, this is an unorthodox 



Ecology, Economy and Society–the INSEE Journal [16] 

introduction indeed. In a linear Cobb-Douglas production function, with its 
assumptions of substitution and returns to scale, Nature is a silent 
participant, a source and sink in the model of inclusive wealth.  In the real 
world, Nature has agency and is a dynamic shaper of the economy. “The 
survival of the natural world depends on maintaining its complexity, its 
biodiversity. Putting things right requires a universal understanding of how 
these complex systems work. That applies to economics too” (HM 
Treasury 2021, quoting David Attenborough).  

If we are indeed embedded in and are dominant actors in Nature, the 
question is not about bringing our aggregate demand in line with aggregate 
supply (G(S)), but about maintaining and promoting (in every way and 
wherever possible) the aggregate stocks and funds of Nature (Georgescu-
Roegen 1975).  The global economy should then be treated as a part of the 
“flows” of goods and services from both “stocks” (historical build-up of 
limited biogeochemical reservoirs of matter) and “funds” (regularly renewed 
biotic resources built and maintained with solar radiation); a user of these 
stocks and funds would then be keen to maintain them within Nature’s 
limits (ibid).  In the real world, produced capital and human capital exist 
within diverse, non-linear, and highly heterogeneous complex adaptive 
systems (Levin et al. 2013).  A model of wealth will then consider how the 
extraction of both stocks and funds, and the (inequitable) accumulation of 
produced capital and human capital, result in a cumulative causation of 
environmental and social costs (Kapp 1968) with lasting impacts on nations 
and Nature.  The Review presents impact inequality as a reductionist macro 
model (see Fig 4.9) of how our demand (Ny/α) exceeds the biosphere’s 
supply stock (G(S)) and ignores lessons from ecology, history, political 
science, and several schools of economics. Again, the Review’s treatment of 
natural capital does not take into account our understanding of both N 
(human population) and y (human economic activity per capita), and 
substantive accounts of the social metabolism (material and energy 
transformations) and material intensity of different countries and their 
respective production and consumption systems. The Review’s treatment of 
natural capital in the economy reinforces mainstream (neoclassical) 
environmental economics. 

The absence of “society” embedded in the biosphere (Fig 4.11) and the 
economy embedded in society, is more than an epistemic erasure in the 
Review. 2  Social capital is seen as necessary only for consumers and 
investors to participate in and comply with the goal of inclusive wealth and 

                                                        
2 Economics does attempt to retain society as a key system shaping the economy within the 
biosphere (Figure 1.5 in The CORE Team, 2017). 



[17] Rajeswari S Raina 

investment decisions. Institutions, likewise, are necessary to manage 
unidirectional externalities arising from economic activity and common 
pool resources (see Chapters 7 and 8). Institutions as norms and rules 
“which have become axiomatic and indispensable by habituation and 
general acceptance” (the economist Thorstein Veblen as quoted in Kapp 
2011, p. 56) are not necessary for the Review because the processes of 
institutional emergence and enculturation are not considered important.  
Institutions as bio-cultural protocols devised by communities through 
social-ecological system changes (BPUMS 2010), and norms and analyses 
that are cognizant of Nature, justice, and time (Faber 2008) which 
acknowledge the incomparability and incommensurability of values in 
ecology and economics (Martinez-Alier et al 1998), are central to our 
understanding of biodiversity in a resilient and sustainable planet.   

There are examples of societies taking institutions into account. In India, 
tribal populations like the Baigas (in Madhya Pradesh) and Soligas (in 
Karnataka) in forests and pastoralists like the Maldharis and Raika (in 
Gujarat) covering tracts along the Western and Northern Indian grasslands, 
acknowledge the complexity and variability of Nature. Just as the Aymara 
and Quechua in the Andes or the Sami in Sweden, they do not acknowledge 
waste (to be dumped in the sink) but account for joint production and time. 
They set non-negotiables and social targets, design institutions, and explore 
economic policies that accomplish these targets. The institutions governing 
their societies and economies help them thrive within the rhythms of 
Nature, with its complexity and biodiversity. The Review, as it picks from 
the discerning evidence sought (see p. 603), ignores these institutions 
governing populations and their socio-metabolic regimes; it presents a 
rather ahistorical and dematerialized treatment of the population problem in 
general. Conspicuously absent are past attempts in Mapping the Interplay 
between Nature and the Economy3 (MINE), estimating green GDP and 
environmental accounting, and scholarship on biodiversity conservation 
and global change. There is no space in the Review for including analytical 
frameworks of justice, diversity, and sustainability in environmental 
research and policymaking, lessons from the environmental social sciences, 
and questions about incentivizing economists to work on the challenges of 
the environment and sustainable development. 

Historically, economic changes following the first and second industrial 
revolutions, and the recession and recovery of the early twentieth century, 
led to macroeconomic models of economic growth being theorized and 
institutionalized. Today, there are already alternatives promoting the 

                                                        
3 See the MINE website, http://nature-economy.de/, for details.  

http://nature-economy.de/


Ecology, Economy and Society–the INSEE Journal [18] 

economics of care, industrial ecology, clean production and consumption, 
environmental justice, and post-growth society. Economists are studying 
these along with transdisciplinary research groups analysing social-
ecological systems, social metabolism, resilience, and the economy within 
Nature’s limits. They analyse the social systems and features of millions of 
actors, the Political Economic Persons (PEPs) who are not the ‘Economic 
Man’ or the utility-maximizing consumer of neoclassical economics 
(Soderbaum 2000). These citizens and organizations, guided by their values 
and institutions that are responsive to social and environmental stress, can 
live within Nature’s limits with minimal throughput. They will refuse to 
participate in supra-national governance and financial mechanisms that seek 
more investments in under-invested natural capital. For them, Nature is not 
‘natural capital’ (an economic entity). Given the pluralism of these citizens 
and organizations marked by value frameworks (diversity, equality, justice, 
or sustainability) and governance models that can coexist and coevolve with 
these frameworks, they will help us live as a part of Nature, within Nature’s 
limits. If the Review had taken due cognizance of these conceptual and 
theoretical shifts and inter and transdisciplinary analyses of human–Nature 
interactions, it would have extended its reach and enriched a more 
insightful analysis of how we can conserve and promote biodiversity. 

 

REFERENCES 

BPUMS. 2010. The Biocultural Community Protocol of the Maldharis of Banni. Banni 
Pashu Uchherak Maldhari Sanghatan (Banni Breeders Association) in collaboration 
with Natural Justice, South Africa, and Sahjeevan, Bhuj, Kutch. 

Dasgupta, Partha. 2021. The Economics of Biodiversity: The Dasgupta Review, HM 
Treasury: London. 

Faber, Malte. 2008. “How to Be an Ecological Economist.” Ecological Economics 
66(1): 1–7. https://doi.org/10.1016/j.ecolecon.2008.01.017  

Georgescu-Roegen, Nicholas. 1975. “Energy and Economic Myths.” Southern 
Economic Journal 41(3): 347–381. https://doi.org/10.2307/1056148  

HM Treasury. 2021. “Nature Is a Blind Spot in Economics that We Ignore at our 
Peril, says Dasgupta Review.” Accessed March 2021. 
https://www.gov.uk/government/news/nature-is-a-blind-spot-in-economics-that-
we-ignore-at-our-peril-says-dasgupta-review. 

Kapp, William K. 1968. “In Defense of Institutional Economics.” The Swedish 
Journal of Economics 70(1): 1–18. https://doi.org/10.2307/3438981  

Kapp, William K. 2011. The Foundations of Institutional Economics, edited by Sebastian 
Berger and Rolf Steppacher. Routledge: London. 
https://doi.org/10.4324/9780203827864  

https://doi.org/10.1016/j.ecolecon.2008.01.017
https://doi.org/10.2307/1056148
https://www.gov.uk/government/news/nature-is-a-blind-spot-in-economics-that-we-ignore-at-our-peril-says-dasgupta-review
https://www.gov.uk/government/news/nature-is-a-blind-spot-in-economics-that-we-ignore-at-our-peril-says-dasgupta-review
https://doi.org/10.2307/3438981
https://doi.org/10.4324/9780203827864


[19] Rajeswari S Raina 

Levin, Simon, Tasos Xepapadeas, Anne-Sophie Crepin, Jon Norberg, Aart de 
Zeeuw, Carl Folke, TerryHughes, et al. 2019. “Social Ecological Systems as 
Complex Adaptive Systems: Modeling and Policy Implications”, Environment and 
Development Economics 18(2): 111–132. 
https://doi.org/10.1017/S1355770X12000460       

Martinez-Alier, Joan, Giuseppe Munda, John O’ Neil. 1998. “Weak Comparability 
of Values as a Foundation for Ecological Economics.” Ecological Economics, 26(3): 
277–286. https://doi.org/10.1016/s0921-8009(97)00120-1 

Soderbaum, Peter. 2000. Ecological Economics: Political Economics for Social and 
Environmental Development. Routledge: London. 

The CORE Team. 2017. The Economy: Economics for a Changing World. New York: 
Oxford University Press. 

https://doi.org/10.1017/S1355770X12000460
https://doi.org/10.1016/s0921-8009(97)00120-1

