Slightly late on this, but I’ve been catching up on the Planet Money podcast, which is about attempting to explain all the high-falutin’ concepts around economics and its occasional breakdowns in a way that makes it understandable to non-economists, and is well worth a listen. At the end of last month they did an episode called “Tallying Up The Pelican Bill” about environmental damage. Specifically, the money they are fined for the damage outlines costs for job losses and tourism charges, but there’s no line item for “Killed 4,000 pelicans”.
The blog post link above summarises the episode, although the actual show is better, as they go though various theoretical methods of working out how much a pelican is worth (from “You cannot put a price on life” meaning – in these terms – “They’re free” on down). Eventually, they come to a non-economic answer from the US governmental department responsible for dealing with this kind of issue: One pelican is worth… exactly one pelican. They require the fined company to invest in breeding centres and such to the point where they cause more pelicans to exist. Not the dollar value they were looking for, but means that BP don’t end up paying fines that end up bailing out those worthless penguins.