--- title: the economy is the smaller number canonical_url: https://ensurance.app/guide/the-economy-is-the-smaller-number markdown_url: https://ensurance.app/guide/the-economy-is-the-smaller-number.md subtitle: "at the coarsest ruler anyone has used, the accounted work of the world's ecosystems came to about one and two-thirds times world gdp. it is a ratio, not a sum." category: ecosystem-services --- # the economy is the smaller number *at the coarsest ruler anyone has used, the accounted work of the world's ecosystems came to about one and two-thirds times world gdp. it is a ratio, not a sum.* Yes, by the best-known global estimate that compares the two in the same year and the same dollars. Robert Costanza and colleagues put the accounted work of the world's ecosystems at about US$124.8 trillion a year in 2011, against world GDP of about US$75.2 trillion the same year, both in 2007 dollars. That is a ratio of about 1.66: the wetlands, forests, reefs, grasslands and soils did work valued at about 1.66 times GDP, and most of it was never invoiced. It is a ratio, not a sum, and this post is as careful about that as about the number. The **global value of ecosystem services** is the coarsest ruler anyone has laid along nature: one number for every biome on earth. Even at that resolution the economy comes out the smaller figure, which is what you would expect if the economy is a subsystem of the biosphere and not the other way round. [*Ensurance*](/natural-assets?from=guide) funds one titled parcel at a time; the global number is context, not the instrument's basis. :::johnson **the economy is the smaller number.** — US$124.8 trillion of accounted ecosystem work against US$75.2 trillion of GDP, 2011, 2007 dollars. Set side by side, never added. [next: you cannot diversify out of the plate →](/guide/you-cannot-diversify-out-of-the-plate?from=guide) ::: ## the number, with its locator Costanza, de Groot, Sutton, van der Ploeg, Anderson, Kubiszewski, Farber and Turner, "Changes in the global value of ecosystem services," *Global Environmental Change* 26 (2014), pages 152 to 158. On printed page 156, after Table 3: "The net effect yields an estimate of $124.8 trillion/yr," and, for comparison, "global GDP was approximately 46.3 trillion/yr in 1997 and $75.2 trillion/yr in 2011 (in $2007)." The paper also reports an alternative of about US$145 trillion a year, which holds biome areas constant at 1997 levels and updates only the unit values. The two are different calculations, not the ends of a confidence interval; the US$124.8 trillion is the one that uses both updated values and the land cover that actually existed in 2011. The same authors returned to it in 2021. Costanza, Kubiszewski and Rasheed, "The Future of Changes in Global Ecosystem Services," *Global Environmental Change* 71 (2021): "In 2011, the estimated global ES value was $125 trillion/yr compared to a global Gross Domestic Product (GDP) of $75 trillion," adding that "some of the $125 trillion ES value is included in GDP, but most ES are non-marketed regulating services." A separate 2021 study by Jiang and colleagues in *Ecosystem Services* reports, in its abstract, terrestrial gross ecosystem product of 108 to 187 trillion US dollars for 2017 and a ratio to GDP of 1.86; it covers land only and uses its own method, so it is a second reading at a similar ruler, not an update of the first. ## you cannot add them, and here is why that strengthens the point The ecosystem number is a welfare valuation built by benefit transfer: a value per hectare per year for each biome, drawn from hundreds of local studies, multiplied by area. GDP is a national-accounts total of market exchange. The two overlap, because some ecosystem services do pass through markets as timber, crops and water, and they are measured on different bases. Anyone who adds them, or writes "nature is worth US$125 trillion", has made an error; the 2021 paper itself notes that some of the value is already inside GDP. Set side by side as a ratio, the comparison does one honest job: it shows the scale of the work the biosphere does relative to the scale of the economy that depends on it. [A valuation is not the worth](/guide/a-valuation-is-not-the-worth?from=guide) is the longer argument for why a number like this is a reading and not a price, and [how ecosystem services get a number](/guide/how-ecosystem-services-get-a-number?from=guide) explains the per-hectare method it rests on. ## a reading at a resolution This is also the point at which the series' own argument turns back on the global number. A single figure for every biome on earth is the longest ruler there is, and [the coastline gets longer the closer you look](/guide/the-coastline-gets-longer-the-closer-you-look?from=guide) says what happens as the ruler shortens: a parcel valued on its own polygon, with its own condition, reads differently from a biome average. The global total is useful for one thing, scale. For a decision about a place, the number has to be read at the place, and [the places are on the map](/explore?from=guide). ## why the ratio matters to a desk A desk that believes the economy depends on nature for half its value has a sector problem. A desk that sees the accounted work of nature exceed the whole economy has a different picture: the thing being depended on is larger than the thing depending on it, and most of it is unpriced. Half of GDP is a line item; five thirds of GDP is the ground the ledger is written on. The last post in the series takes that picture to the one question an allocator can actually act on. This is research, not investment, legal or tax advice. ## frequently asked ### what is the global value of ecosystem services? About US$124.8 trillion a year in 2011, in 2007 dollars, by Costanza et al. (2014), with an alternative calculation of about US$145 trillion that holds biome areas at 1997 levels. A 2021 terrestrial-only study by Jiang and colleagues read 108 to 187 trillion for 2017. These are welfare valuations by benefit transfer, not market totals. ### is the value of ecosystem services bigger than world gdp? By the 2014 estimate, yes: US$124.8 trillion against world GDP of US$75.2 trillion in 2011, both in 2007 dollars, a ratio of about 1.66. The 2021 terrestrial study read a ratio of 1.86 for 2017. ### can you add ecosystem service value to gdp? No. One is a welfare valuation by benefit transfer, the other a national-accounts measure of market exchange, and they overlap where ecosystem services pass through markets. The honest use is a ratio set side by side, which the authors themselves provide. ## sources [Costanza et al., *Global Environmental Change* 26 (2014) 152–158, printed p. 156](https://www.robertcostanza.com/wp-content/uploads/2017/02/2014_J_Costanza_GlobalValueUpdate.pdf), [DOI](https://doi.org/10.1016/j.gloenvcha.2014.04.002). [Costanza, Kubiszewski and Rasheed, *Global Environmental Change* 71 (2021)](https://www.robertcostanza.com/wp-content/uploads/2021/12/2021_J_Costanza-et-al-Future-of-ES-GEC.pdf). [Jiang et al., *Ecosystem Services* 52 (2021), abstract](https://ui.adsabs.harvard.edu/abs/2021EcoSv..5201361J/abstract). Locators are from the founder's check of 9 November 2026; the sandbox this was drafted in cannot reach the source hosts. ## the series 1. [the trillion dollar ruler](/guide/the-trillion-dollar-ruler?from=guide) 2. [what the $44 trillion actually counts](/guide/what-the-44-trillion-actually-counts?from=guide) 3. [follow the supply chain and the number climbs](/guide/follow-the-supply-chain-and-the-number-climbs?from=guide) 4. [the economy is a subsystem](/guide/the-economy-is-a-subsystem?from=guide) 5. [the economy is the smaller number](/guide/the-economy-is-the-smaller-number?from=guide) 6. [you cannot diversify out of the plate](/guide/you-cannot-diversify-out-of-the-plate?from=guide)