The Dasgupta Review

The Dasgupta Review investigates the value of natural resources and processes as economic assets, describing ways in which they can be better accounted for and better protected.

It was commissioned by HM Treasury in 2019; interim findings were issued in April 2020, with the finished report of 606 pages published in February 2021 (abridged versions are available).

The project was led by noted economist Professor Sir Partha Dasgupta, of the University of Cambridge. It was supported by a panel drawn from public policy development, science, economics, finance and business.

Key findings

The Review identifies natural resources (eg: forests, soil) and natural systems (eg: the carbon and water cycles) as economic assets, alongside man-made assets (eg: machinery, skills).

Bio-diversity is desirable, since it reduces exposure to risk and increases system resilience, in the way that a diversified stock portfolio reduces financial risk.

Currently, the value of nature is not accounted for adequately by either common economic measures or by business book-keeping processes.

Likewise, harmful outcomes from economic activities (known as “externalities”) are not covered by a realistic economic price – often there is not price at all.

This means that damage is often unrecorded and the costs of natural harms do not influence decision-making by governments, businesses or citizens.

Unfortunately, due to mis-management and poorly-informed decision-making, the quality and quantity of natural capital is falling fast, worldwide.

The harm already done represents a threat to the sustainability of human activity, now and in the future. Yet more damage will be done unless radical remedial action is taken.

Food production

Food production for an over-large human population is identified as the most significant burden on natural systems, with meat being especially problematic.

The Review highlights issues of high wastage in food systems, unhelpful food subsidy schemes and distorted pricing (with food seen as under-priced for buyers in wealthy markets).

The Review identifies a number of technologies that might help to manage the environmental impact of food production such as GM organisms, vertical farming precision farming and meat analogues.

However, even if deployed at scale. none of these are likely to be sufficient to allow the global food system to maintain “business as usual”.

The only solution offered is to waste less and to consume less – especially less meat. This is summed up as a “fundamental restructure” of the food system.

Key recommendations

1. Ensure that consumption of resources does not exceed replenishment rate / increase the supply of natural capital:
   1. Restructure global food system
   2. Invest in population management via family planning
   3. Conserve and restore natural assets, especially in developing economies
2. Adopt new measures of economic success, to guide sustainable development
   1. Replace GDP with new measure of “inclusive wealth”, which would give value to natural assets and preservation of those assets for future generations
3. Transform institutions and educate citizens
   1. Payments for nations that safeguard their natural resources
   2. Fees to be paid for use of shared resources (eg: fisheries)
   3. Reform of financial systems to encourage support for natural world
   4. Education to help connect citizens with the natural world

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