The place of nature in economic development

Official development economics reflects the rest of the discipline, in that it too neglects nature's place in economic development. The neglect looks odd to ecologists, who are trained to study the slow processes that influence long-term development possibilities. A seemingly natural retort to ecologists is that people come first and that, after all, current poverty should matter most. Despite the neglect, there is now a growing literature on the links between rural poverty and the local ecology. Because economic theory predated economic empirics in that body of work, empirical studies have frequently been designed by scholars to respond to the theory. This paper draws on that literature to show how economics can be reworked to include nature's services in the study of development processes. Unfortunately, even now there are few reliable empirical studies. One reason for the dearth may be that, with the exception of forest cover, government surveys (even the best of them, such as the Indian National Sample Survey) don't include detailed information on ecological capital. In addition to studying household behaviour, investigators therefore have to obtain their own data on the state of the local ecology.