On Natural Capital: The Value of the World Around Us Partha Dasgupta Witness (2025)
An economist might celebrate a nation achieving record economic growth on one day, yet overlook a coral reef lying bleached and lifeless on another. This contradiction must be challenged, writes economist Partha Dasgupta in his elegant account of why the global economic system is exploiting, rather than sustaining, life on our planet.
On Natural Capital recaps the roaring economic advances of the past 75 years, including improved life expectancies and education and fewer people living in poverty. But it also shares how economic progress has benefited from the exploitation of our planet: an ecological debt that conventional accounting leaves off the balance sheet.
How to build nature back better — read this manual
Dasgupta starts by vividly portraying the essential workings of Earth’s life-support systems and how living processes regulate the climate, replenish soils and sustain food webs. He notes that one-third of the planet’s remaining wetlands, which are crucial for filtering nutrients, providing flood protection and storing carbon, have been lost between 1970 and 2015 owing to infrastructure construction, urban expansion and other human activities. He also describes how deforestation can create savannah-like conditions in parts of the tropics, because the disruption of moisture-recycling processes decreases rainfall and ecological productivity.
Next, Dasgupta examines why economic principles have long treated nature’s functions as background scenery. He explains that this omission is rooted in the mid-twentieth-century origins of growth and development economics, in which economists constructed models that explained output using only human labour and skills, and physical goods. This was a reasonable assumption back when natural resources seemed abundant, the world wasn’t pressing against planetary limits and forests, soils and fisheries seemed too plentiful to constrain growth. What began as a practical simplification evolved into a blind spot.
Uneasy trade-offs
By stitching these two narratives together, Dasgupta succeeds in portraying woodlands, watersheds and wild species as bona fide assets, the depletion of which undermines the prosperity statistics that governments use to track and celebrate progress. He solidifies this narrative by estimating that humanity’s collective demand on nature now exceeds the planet’s regenerative capacity by around 70%. Effectively, this means that, since the early 1970s, we have been living off the planet’s ‘capital’ rather than the accrued ‘interest’, jeopardizing our biosphere’s solvency.
Beyond growth — why we need to agree on an alternative to GDP now
As Dasgupta’s writing flows between nature’s processes and economic principles, he stresses the uneasy trade-offs that societies navigate daily. Each tonne of fish landed or cubic metre of water taken for irrigation is a draw on assets that must remain intact to avoid compromising future yields of food, income and ecological stability.
... continue reading