Economic valuation and analysis – A building block towards inclusive green economy
Making the economic case of the importance of sustainable management of the environment and natural resources for pro-poor economic growth, and achievement of the Sustainable Development Goals is an important component of the Poverty-Environment mainstreaming approach.
Economic-based analysis and argumentation for environmental investment can be the most effective in convincing decision-makers on the importance of environmental sustainability for achieving development goals. It requires one to understand and be able communicate on the environment and associated systems in economic terms, and how the environment sector can be explained as a productive sector that can be managed to generate pro-poor and inclusive economic growth.
In response to country demand, PEI had piloted a number of economic valuation studies at country level that aimed to inform and influence economic development policy and planning. These studies touch on key aspects of the PEI publication “Making the Economic Case: A Primer on the Economic Arguments for Mainstreaming Poverty-Environment Linkages into Development Planning” including:
- Treating the environment base as an economic asset where environmental resources and ecosystem services are seen as productive natural capital having economic values, and where trade-offs exist between investing in sustaining this natural capital and converting it to other uses or allowing for degradation.
- Emphasizing the economic returns from environmental investment and the economic costs of environmental degradation. This can be expressed through a number of variables including among others employment, returns on investment related to rehabilitation of ecosystems, human health affected by pollution and degradation, effects from climate change, improved or lost agricultural productivity and food security, etc.
- Understanding human and economic well-being outcomes and linking environmental goods and services with national economic and social indicators used to measure progress towards poverty reduction, equality and inclusive economic growth.
Key Resources
- Environmental Economic Analysis of Natural Resources Management in Mozambique: Links Between Poverty and Environment Final Report
- Making the economic case: A primer on the economic arguments for mainstreaming poverty-environment linkages into national development planning
- Reducing poverty through macro-level investments in environmental sustainability: Malawi
- Overcoming Poverty in Malawi through Sustainable Environment and Natural Resource Management
- Cost Benefit Analysis of the Community Livelihoods Improvement Initiatives in Tanzania; Lessons for Enhancing Integration of PovertyEnvironment Linkage Objectives into National and Sub-national Development Planning and Budgeting Frameworks
- Assessment of the Economic, Social and Environment Benefits of the Rubaya Green Village in Gicumbi District, Rwanda, and Benefits of Project Replication
- Cost Benefit Analysis of the Community Livelihoods Improvement Initiatives in Tanzania
- Economic Analysis of Natural Resource Management in Rwanda
- Final Report on Four Economic Instruments
- Evaluation des coûts de la dégradation ou de la mauvaise utilisation des ressources naturelles en Mauritanie: Version finale
- Evaluation des coûts de la dégradation ou de la mauvaise utilisation des ressources naturelles en Mauritanie: Note de Synthese
- Economic Analysis of Natural Resource Management in Rwanda