Dasgupta Review: Vivid Economics in collaboration with the Natural History Museum finds delayed action doubles costs
Today HM Treasury launched The Dasgupta Review, an independent global review on the Economics of Biodiversity that Chancellor Rushi Sunak will now formally respond to. The commissioning and launch of a biodiversity review by HM Treasury signifies an important shift that has been underway as the economic importance of nature gains prominence across business and governments. The Dasgupta Review sets out the economic case that our economy is embedded in nature and that a sustainable future requires a change in economic policy.
Vivid Economics in collaboration with the Natural History Museum contributed to the review with an analysis of global land use and food production scenarios, highlighting the economic costs associated with pathways to protect and restore nature while providing food for a growing human population. For while the ecological case for urgent action is well made by ecologists and NGOs — more endemic species will go extinct in the coming 30 years than appear to have died out in the entire period 850-1850 CE — there is a need for economic analysis to understand this can be managed in concert with other priorities such as food security and decarbonisation.
Our analysis shows that action to protect nature now is far cheaper and avoids higher wider economic costs than a delayed response. Even a delay 10 years would more than double the social cost of intervention, from around 8% to 17% of current global GDP – a difference of equivalent to almost 40% of the GDP of the US in 2019. This stems from much higher incentives required for reforestation and higher food costs if action is delayed.