Natural Capital

Definition

Natural capital refers to the world's stocks of natural assets, including geology, soil, air, water, and all living things. It provides the ecosystem services that are essential for human survival and economic activity, linking environmental health with social and economic well-being. This concept highlights the value of nature in providing resources like clean water, timber, and pollination, which are fundamental for sustainable development.

5 Must Know Facts For Your Next Test

1. Natural capital is vital for maintaining ecosystem services that support life, including clean air and water filtration.
2. Human activities like deforestation and pollution can deplete natural capital, leading to a decline in ecosystem health and the services they provide.
3. Valuing natural capital in economic terms can help integrate environmental considerations into decision-making processes for better resource management.
4. Natural capital accounting is a method used to measure the value of natural assets and their contribution to the economy and society.
5. Restoring and preserving natural capital is crucial for achieving long-term sustainability and resilience against environmental challenges.

Review Questions

• How does natural capital relate to ecosystem services and why is this relationship important for sustainable development?
  • Natural capital is directly linked to ecosystem services as it provides the resources and benefits that sustain human life and economic activities. This relationship is crucial for sustainable development because it highlights the importance of preserving our natural resources to maintain these services. By recognizing the value of natural capital, we can make informed decisions that protect our environment while fostering economic growth and social equity.
• In what ways can depletion of natural capital impact social and environmental systems?
  • Depletion of natural capital can lead to severe consequences for both social and environmental systems. When natural resources such as clean water or fertile soil are diminished, communities may face food shortages, health issues due to pollution, and economic instability. Environmentally, reduced natural capital results in loss of biodiversity and disruption of ecosystem functions, ultimately threatening the resilience of both human societies and natural environments.
• Evaluate the role of natural capital accounting in informing policy decisions related to environmental management.
  • Natural capital accounting plays a critical role in informing policy decisions by quantifying the value of natural assets in monetary terms. This approach allows policymakers to understand the economic implications of environmental degradation or conservation efforts. By incorporating natural capital into national accounts, governments can prioritize investments in sustainability initiatives and create policies that support long-term ecological health while fostering economic growth. This evaluation helps ensure that environmental considerations are integrated into broader economic planning.

Related terms

Ecosystem Services:

The benefits that humans receive from natural ecosystems, including provisioning services like food and water, regulating services such as climate control, and cultural services that provide recreational and spiritual benefits.

Sustainable Development: A development approach that meets the needs of the present without compromising the ability of future generations to meet their own needs, emphasizing the balance between economic growth, environmental stewardship, and social equity.

Biodiversity: The variety of life on Earth, encompassing the different species of plants, animals, and microorganisms as well as the genetic diversity within these species and the ecosystems they form.