Ecological Economics: Principles of Economic Policy Design for Ecosystem Management

Ecological economics studies the interactions and coevolution in time and space between ecosystems and human economies. The rate at which humans exploit or harvest ecosystems services exceeds what might be regarded as a desirable level from society’s point of view. The consequences of this overexploitation are well known (e.g., climate change, biodiversity loss and extinction of species, collapse of fisheries, overexploitation of water resources). The objective of designing economic policy is to develop a system of regulatory instruments so that the state of the regulated ecosystems will converge toward the socially desirable outcome. The purpose of this chapter is to present an approach describing how economic policies might be designed to achieve this objective.