Modelling biodiversity and ecosystem services in coupled ecological-economic systems

This chapter considers how economists model biodiversity in coupled social ecological systems, taking two polar cases along with a more general problem. Economists assume that all human decisions are purposive: people are assumed to optimize some objective function subject to some set of initial conditions, to some set of resource constraints, and to the dynamics of the system being used. The chapter considers two polar cases and one intermediate case. One polar case involves the preservation of wilderness areas or protected parks in 'close to natural' states. A second involves the exploitation of ecosystems to produce foods, fuels and fibers. The intermediate case involves the management of ecosystems to achieve a balance between non-consumptive cultural services with consumptive provisioning services. While the constrained optimization technique applied in all three cases may be unfamiliar, the chapter tries to give the intuition behind it. It also provides a verbal description of each of the three model structures developed. In all cases the social and biogeophysical components of the coupled system are interdependent - connected through a series of feedback loops. Economists refer to such systems as 'general equilibrium systems'. That is, the dynamics of the system in some state are driven by a tendency towards the equilibrium corresponding to that state, and any perturbation has the potential to stimulate responses across the system.